This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

CPB: Earnings Trade (Incl video)

Stocks in this article: CPBHNZ

WEBINAR, September 6: Designing and Implementing a Retirement Plan CLICK HERE FOR INVITE AND TO REGISTER.

Campbell Soup Company (CPB) hit a year high of $35.60 on Tuesday spreading its 52-week range to $29.93-$35.60. CPB has a market cap of 11.09 billion, earnings of $2.31 per share, and a Div/yield of $0.29/$3.29. The stock has surged in the past month after a dip early this summer during the end of May and beginning of June. The spot price is about one point about the 20-day moving average, $34.45, and about two points above the 50-day average, $33.46.

CPB announced earlier this month that it acquired Bolthouse farms $1.55 billion in cash in an attempt to increase its presence in the packaged fresh-food and high-end juice market. Bolthouse had $689 million in sales in its fiscal year ending March 31. CPB also owns Pepperidge Farms.

On Tuesday, Sept. 4, 2012, at 10 a.m CPB will be reporting its fourth quarter 2012 earnings over webcast. In 2011 CPB earnings beat analysts' projections by almost 2%. This year, the company is average 5% higher earnings than projected by analysts. For the fourth quarter, released Tuesday, analysts are projecting earnings of $0.38. CPB saw a loss of $0.33 after quarter three announcements of $0.56 EPS, a change from increases stock value after 2010 yearly earnings and first and second quarter earnings.

05/21/12 $33.40 $32.75 $-0.65 (-1.9%)

02/17/12 $32.06 $32.90 $+0.84 (2.6%)

11/22/11 $33.61 $31.84 $-1.77 (-5.3%)

09/02/11 $31.86 $31.46 $-0.40 (-1.3%)

Average Magnitude of Post Earnings Return 2.8%

Near-Term Straddle Indication:

Term Strike NBBO Size %Spot(Mid)

09/22 $35 $1.20 - $1.45 36 x 581 3.8%



My Trade: Selling the CPB September 35-36 Call Spread at $.50 Risk: $50 per 1 lot

Reward: $50 per 1 lot

Breakeven: $35.50

Notes: I make money on this trade if CPB is flat, down, up less than 1%. Since Heinz (HNZ) sold off on earnings, I think CPB could follow suit.

OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits

Andrew Keene can be followed on Twitter at twitter.com/KeeneOnMarket

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,399.67 +19.26 0.12%
S&P 500 1,904.01 +17.25 0.91%
NASDAQ 4,316.0740 +57.6360 1.35%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters