Options strategy: Buy the house and put the odds in your favor !
Today's Financial News - Posted September 18, 2009
Penn National Gaming (NASDAQ:PENN) is looking very strong… reason enough for us to enter a promising options position with a 70% upside!
by Andrew Snyder
Baltimore, MD — TFN: It’s an interesting time for the nation’s casino operators. Tourism is down, commercial real estate values are through the floor and the folks that have any money are unwilling to gamble it away.
And the president himself is maligning corporations who’d piggyback their conferences and annual meetings in towns like Las Vegas.
The situation’s having a hugely detrimental impact on the nation’s highly leveraged casino operators.
But all is not bad, especially for growing financially stable companies like Penn National Gaming (NASDAQ:PENN). With nearly $800 million in cash at the close of last quarter, the company is able to take advantage of its competitors’ pain — and search out potential acquisition opportunities.
Today’s headlines prove the company is on the prowl. While the negotiations are still hot, there is a good chance Penn National may be ready to sign on a deal that allows it to acquire Fontainebleu’s Las Vegas resort, a $3 billion hotel and casino that was recently put on hold due to financing issues.
If the purchase happens, Penn National would have its first exposure to the Las Vegas gambling industry. It could mark the start to a very lucrative stream of revenues for the company.
Even better, Penn National is about to be handed a huge opportunity in Pennsylvania.
With a huge budget shortfall, Pennsylvania’s legislators will likely legalize table games in an effort to generate more tax revenues. For a company like Penn National that has a strong exposure to the market, this is fantastic news.
Shares of Penn National are currently trading for $27.63. Thanks to the two potential revenue streams above, that share price could rise well above recently reached 52-week highs of $35.18.
There’s a set of options I recommended to members of my options service TFN Strategic Trader that could surge by over 75%.
I say we take advantage of the leveraging potential of options and play this move.
I could tell you exactly what options to buy. But then I’d have no way to let you know when to pull the trigger… and take sweet gains off the table as they arise.
Which is why I’d like to encourage you to join our tightly knit circle of subscribers at TST. Do me a favor and read over my general approach before you decide…
Next Article: Solarindustrie: Das Rennen hat begonnen
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September 18th, 2009 at 6:15 pm
Hi,
Just another note on health care. Now please know that I am against the bill in every form that I have seen so far but did want to say that your article today says people making over $200,000 will pay the bill. A lot of people think this but while they are targeted for a big chunk people making far less will pay large parts of their income whether they want to or not. In todays paper the last attempt to get it going has people with incomes of $32,000 per year paying a huge 16% of their income for health insurance. In addition if you do not get it you will be fined and if your employer does not offer some type of reasonable (?) insurance he will be finded as well. Everyone seems to think this is free coverage but the only people who get it free are people with no jobs and illegals(I know they say they are not covered but there is no provision to do anything to find out if they are illegal or to stop them if they do find out). Now I have medicare and have no choice about it and they are taking five hundred billion from medicare to help with the health care. You tell me how great our coverage is going to be improved. Everyone seems to think that we get that free as well but the average person on medicare gets about $1000 a month he has 96.40 taken out for medicare or 9.64% of income and he has decuctables and pays a twenty percent co-pay. If he has supplemental insurance that is another cost between around $35 for fee for service (with large co-pays) to $500 a month for very low co-pays or no co-pays. In addition we have the cost of part D which is another $10 to $100 a month depending on how much co-pay you want. If you add my insurance for this, the cost of the drugs & the co-pay it is more than I paid before this went into effect and just had a senior discount card from the pharmacy. Everytime anyone, insurance company or government gets in the mix you have an added cost and that cost adds nothing to your care. Look at dental insurance. By the time you pay the cost and the co-pay it is the same as the cost without it and it has increased everyone elses cost. We have to go to Mexico to afford a dentist. Do not let the government get anymore involved in deciding what care you can have and who you can see and how much it costs. They have a proven record of making anything they do cost more and have more fraud involved as well.