Just came back to this stock for the first time in years to find the current circumstances. After taking in all of the financials, news, and assessing the sentiment, this seems like something that would be silly not to hold a small amount of.
The sell puts for $1 give a net 9% ish right now and break even at 0.85ish on bad news.
Given the markets negative reactions to other not terrible earnings, it could touch 0.6ish on bad news. That said, it’s seems like expectations are already at a low bar with (understandably) very negative sentiment. Contrarily, following the restructuring, there seems to have been a number of recent positive developments. If positive and we close above one dollar this week, this will be the easiest 14% I’ve ever made in my life.
If abhorrent company killing news (like no longer having the healthy 13 month cash runway), minor 2% loss that I’ll sell calls on. If tolerably negative news, I’ve only put in about 2% of my portfolio and have plenty of room to double or sell more puts to average down while selling high IV calls at $1.
With this risk reward profile/ plan (and the mobility that the current price affords with options) I find it unreasonable not to hold at least a small amount of this stock.
I know, I’ve said nothing about the short squeeze possibility. It’s because, despite the nice setup, I don’t want to count on that with how powerful shorts are. My topside is capped with this strategy to rake in premiums (unless I average down and hold half open) so I don’t go in with that plan. Seems like a solid high risk high-IV wheel opportunity for the common man though.
Would love to hear dissenting opinions but grounded in numbers/ facts/ or strong clear logic. Good luck to yall!