FAANG Earnings Week Ahead: Apple, Amazon, Google, Meta, Microsoft
FAANG Earnings Week Ahead: Apple, Amazon, Google, Meta, Microsoft
By:Mike Butler
Earnings Explorer week of July 25
Last week brought quite a stir in the market – Monday through Thursday we saw great strength in the NASDAQ and S&P 500, with strong earnings moves in TSLA and NFLX – with the S&P 500 market down 55 points on Friday and so many big names reporting earnings this week, I’d be surprised if we did not see some big market moves! Let us look at an earnings preview for this week below.
.png?format=pjpg&auto=webp&quality=50&width=30&disable=upscale){kind=small}
Apple
AAPL – reporting Thursday the 28th AMC (after market close) - 6 pt. weekly expected move - 4% of the stock price
AAPL has sold off quite aggressively over the past few months, but surprisingly it has the lowest expected move relative to the stock price compared to the other big-name stocks reporting this week. Outside of the weekly cycle implied volatility, AUG & SEP are both flatlining around the same level of 33% - I’m looking at calendar and diagonal spreads to take advantage of the near-term high IV% in the short-term cycle, without paying for much of an IV% contraction in AUG/SEP. The short option will have one day to expiration if the trade is placed on Thursday as well, so this is my second favorite trade for the week!
.png?format=pjpg&auto=webp&quality=50&width=30&disable=upscale){kind=small}
Microsoft
MSFT – reporting Tuesday the 26th AMC – 12 pt. weekly expected move - 4.5% of the stock price
MSFT is a mirror image of AAPL’s IV% structure, with a slightly higher IV% in AUG/SEP. I am still looking at the same strategies in MSFT with flatlined IV% in the back months. Calendar & Diagonal setups on Options Trading Concepts Live on Tuesday at 11 am CST!
.png?format=pjpg&auto=webp&quality=50&width=30&disable=upscale){kind=small}
Amazon
AMZN - reporting Thursday the 28th AMC – 8 pt. weekly expected move - 6.5% of the stock price
AMZN did not see the post-split rally many had hoped for, and now the expected move for earnings is still relatively low compared to the stock price. 50% IV around the AUG/SEP cycle is higher than the previous stocks covered, but these figures are still relatively low compared to the LEAP expiration cycles of 45%. This is another Thursday announcement, which sets up well for aggressive IV crush weekly short options trades like diagonal spreads, calendar spreads, ratio spreads, broken wing butterflies etc.
.png?format=pjpg&auto=webp&quality=50&width=30&disable=upscale){kind=small}
Alphabet
GOOGL – reporting Tuesday the 26th AMC – 7 pts. weekly expected move - 6% of the stock price
GOOGL’s stock price finally split, so now we’re looking at a much more affordable $107 stock price! Still, low IV% here mimics a similar environment as AMZN – This is the weakest setup of the group, with low IV% and a Tuesday announcement, where weekly options may not decay as aggressively as Thursday announcement options will.
.png?format=pjpg&auto=webp&quality=50&width=30&disable=upscale){kind=small}
Meta
META – reporting Wednesday the 27th AMC – 19 pt. weekly expected move - 11% of the stock price
This is the largest expected move of the bunch, and calendar spreads set up in an interesting way – the IV% structure is similar to NFLX in the sense that a SEP OTM option cost basis can be reduced by upwards of 30% for many strikes by selling the weekly option against it. I am looking at a double OTM calendar spread personally, but I’ll do a deep dive on OTC Live on Wednesday!
To get started trading earnings announcements open an account on tastytrade!
tastytrade, Inc. and tastylive, Inc. are separate but affiliated companies.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.
tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on tastytrade.com/disclosures.
tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.
tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.
tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.
© copyright 2013 - 2024 tastylive, Inc. All Rights Reserved. Applicable portions of the Terms of Use on tastylive.com apply. Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.