HRB Rebound post-sell off, Buy 15JAN CALL $18 @ $0.2 - $0.4
Fundamental analysis indicates
HRB
will continue to perform well under COVID restrictions, especially as newly implemented vaccinations bolster its broader market within the tax industry that includes face to face consultations (unlike
INTU
- TurboTax). The US is also entering its historic tax preparation season, following the holidays. Sentimental analysis sets the stage for a strong rebound ( there was an earnings based sell off as
HRB
fell short of pervious years earnings gap for the quarter) all other news has posed several recent stock valuation upgrades. Average market analysis evaluation suggests a median valuation of $20, being at $16.40 creates $3 of potential value. Technical analysis shows
HRB
has been in a 2 week bear run. The RSI highlights being in the oversold region (below 20). The MACD is posturing for a crossover below the 0-ine, and the 13 SMA is trending to cross over 30 SMA which will confirm the trade's validity.
Entry price - $15.95 - $16.80 // $0.15-$0.3 (18 DEC CALL $17 strike) // $0.2-$0.4 (15 JAN CALL $18 strike) // $0.65-$0.95 (16 APR CALL $18 strike)
TGT Sale price - $19 (conservative) / $21 (higher risk) // 100% option value (high risk)
Stop loss - $14.20 (conservative) / 50% of Options price (higher risk)
Max position size - 5% of portfolio
HRB
will continue to perform well under COVID restrictions, especially as newly implemented vaccinations bolster its broader market within the tax industry that includes face to face consultations (unlike
INTU
- TurboTax). The US is also entering its historic tax preparation season, following the holidays. Sentimental analysis sets the stage for a strong rebound ( there was an earnings based sell off as
HRB
fell short of pervious years earnings gap for the quarter) all other news has posed several recent stock valuation upgrades. Average market analysis evaluation suggests a median valuation of $20, being at $16.40 creates $3 of potential value. Technical analysis shows
HRB
has been in a 2 week bear run. The RSI highlights being in the oversold region (below 20). The MACD is posturing for a crossover below the 0-ine, and the 13 SMA is trending to cross over 30 SMA which will confirm the trade's validity. Entry price - $15.95 - $16.80 // $0.15-$0.3 (18 DEC CALL $17 strike) // $0.2-$0.4 (15 JAN CALL $18 strike) // $0.65-$0.95 (16 APR CALL $18 strike)
TGT Sale price - $19 (conservative) / $21 (higher risk) // 100% option value (high risk)
Stop loss - $14.20 (conservative) / 50% of Options price (higher risk)
Max position size - 5% of portfolio
It seems to be consolidating at this new lower price point. I did lose money on this play initially, however, I am still confident HRB will turn around especially as we approach tax season.