WUBA traded close to 7% below the purchase price today, although the stock is finding support at the 50 day moving average. Since the stock is due to report earnings next Thursday and is unlikely to provide at least 5% profit cushion before then, the stock can be sold today.
BZUN broke out of a base yesterday and continued higher today after reporting better than expected earnings yesterday. The stock was on our backup watch list and is buyable from $52.50-55. Since the stock is near the top of this buy zone, an entire position can be bought at once rather than buying half a position initially. Use 7-8% below purchase price as stop loss. If you miss the opportunity to buy today, then you can place a limit order to buy if the stock reaches $55 or lower. This way, your order will be filled if the stock re-enters the buy zone next week.
GOOS broke out of its base this morning and traded solidly above the $38.25 buy point. Buy half position here and buy other half if stock goes 2% above initial purchase. Use 7-8% below purchase price as stop loss.
WUBA traded more than 2% above our initial purchase today, so the second half of the position can be bought. Use 7-8% below purchase price as stop loss.
WHD reports earnings tomorrow after the close. The stock only has 3% profit cushion so it must be hold before earnings. Since this is stock’s first earnings report since going public, the risk is higher than normal. At least 15% profit cushion is advised to hold such a recent IPO through its first earnings report.
WUBA is trading within its buy zone, so the first half of a position can be purchased. The stock is buyable from $86-90. Set stop loss to 7-8% below purchase price. Buy second half of position after stock advances 2% above initial purchase.
VNOM was sold today as it reached our profit goal at $31.50. It is usually best to have a limit order in place when a stock gets near the profit goal. The stock only briefly traded above this price level, although it is perfectly acceptable to take profits slightly under this price. If a limit order was in place, then the stock was automatically sold.
LGIH was sold today since it did not have enough profit cushion to hold through tomorrow’s earnings report. However, the stock is setting up for another potential breakout with a buy point at $75.52. If the stock trades above this level tomorrow, then the stock can be bought back. Just do not buy the stock more than 5% above this price. Also, it is usually best to wait until a day or two after earnings to avoid the volatility that frequently accompanies earnings reports.
This month’s educational blog post discusses how to manage recent IPOs during earnings season. Click here for this month’s educational newsletter.
FND had to be sold this morning as it reached our stop loss of 1% overall gain. The stock gapped down after a disappointing earnings report.
VNOM is trading up nicely after reporting earnings after yesterday’s close. If the stock reaches the 20% profit goal at $31.50, then sell all shares. If the earnings report continues to be viewed favorably by institutions, then the stock is likely to reach this price soon.
FND is trading down slightly today, but the core position should still be held through tomorrow morning’s earnings report. However, the shares that we added on April 4th should be sold today as they are essentially breakeven. Therefore, these shares do not have suitable profit cushion to hold through the earnings report.
VEEV was sold today since it reached our stop loss of an overall 1% gain. The stock is set to close slightly above our stop loss, but the stock rebounded today on low volume, which is concerning.
LGIH was sold today since it dropped 7-8% below our purchase price. We sold the second half of our position on April 12th as its stop loss was hit, but today the stop loss was hit for the first half of our position.
PAGS was sold today when it traded well below the most recent stop loss at $33.50, which was the recent swing low. Today also looks like it will be the largest single day point loss since the stock went public, which is a very weak sign. Finally, the stock breached both the 50 day and 10 week moving averages for the first time ever.