Explore the past trends of some of the most traded stocks unveiling their earnings this week. Observe how these stocks have historically fluctuated around their earnings dates.

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To illustrate, by analyzing past trends, we can observe that Wayfair (W) exhibits the highest level of fluctuation immediately following earnings announcements, with a standard deviation of movement of +/-13.5%. Over the past 5 years, its largest overnight movement after earnings has reached a high of 30.5% and a low of -24.2%. While we generally consider implied volatility as an effective predictor of movement, having additional tools to assess price fluctuations is always beneficial.

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Here are a few notable dividend stocks. However, it is important to remember that at tasty, we advise against purchasing stocks solely based on their dividends. Nevertheless, for long-term investors, the dividend stream can be a factor to consider in generating additional cash flow.

PYPL Naked Put + Call Ratio Spread

PYPL has been one of the unloved tech names of the past three years, currently sitting at multi year lows. Current IV projects a roughly +/- $4.54 expected move through the end of the week with earnings reported on November 1st. If you think the bad news is already baked in, and we might see some sideways/up move from the lows, a naked put at the 48 level provides enough credit to offset the small debit on an upside call ratio spread long 1x/2x the 52/55 call ratio, done for a net $1.00 credit (November 3rd weekly expiration). Max profit hits with a pin at 55 through earnings, and has a nearly 50% potential ROC based on the $800 in buying power.

CVX Call Diagonal Spread

Oil prices have bounced around the 75-90 range for the majority of Q3, near multi year highs while CVX has hit a 52-week lows. If you think we might get a bounce in one of the largest oil and gas companies, a long call diagonal might fit the bill. Long the 150 call in the January monthly provides enough time for the move to play out, while the short 155 call in the December monthly expiration provides a bit of positive decay to offset time decay on the long option. The spread is nearly 20 delta long at just $3.50 debit, roughly 10% of the comparable share notional value. 

Halloween hits tasty

Brittany does her best Guy Fieri imitation

Thanks to Ryan Sullivan for taking the picture.

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