NEW YORK (TheStreet) -- Last week IBM (IBM) was taken to the woodshed for failing to deliver the earnings results investors were expecting.
That was last week --now I am looking at IBM as a discounted ticker ready to perform for those willing to buy when there is blood on the streets. IBM makes a excellent example of how options can improve our likelihood of success when fear has entered the hearts of shareholders.
Let's examine what happened and how to use that information to your advantage.
After researching, you can find better opportunities such as Microsoft, a company I recently wrote about in "Microsoft Is a Buy Before Earnings Release." Another company is shown in "Surviving Oracle in an Amazon World," a stock that missed on earnings but is now trending higher. IBM falls into the same category as Oracle. IBM is a technology titan that is now a value buy as a result of a minor speed bump on the path to profits. If you can look past the inability of analysts to accurately forecast earnings, you can own Big Blue with its 1.8% yield at a forward estimated payout ratio of under 30%.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- 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 + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV