General Cable’s (BGC) stock decreased a little more than one percent on average volume Monday as the cable supplier announced a $70 million contract with the Northeast Utilities Services Co. and United Illuminating Co.
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The company’s French subsidiary, Silec Cable, was awarded the underground high-voltage project. This project is part of a $1.3 billion electric transmission upgrade in Middletown-Norwalk, Connecticut. General Cable’s portion of the project includes cables, engineering, installation supervision, and on-site cable splicing.
This award follows a recent successful project in Bethel-Norwalk, Connecticut. The Bethel project was the longest cable installation to date in the United States. The company’s technology is a noteworthy improvement over the existing techniques used in the United States as it is more cost effective, easier to install and maintain, and lessens environmental impact.
Bernard Ernot, President of Silec Cable said in a press release, “We are proud to have successfully partnered with Northeast Utilities for the Bethel-Norwalk project and to be chosen by both Northeast Utilities and The United Illuminating Company for the larger-scale Middletown-Norwalk project. These projects set the stage for a broader use of synthetic insulated cable systems by United States utility companies for the upgrade and expansion of their high-voltage energy transmission networks to reliably meet the growing demand of their customers.”
Competitors:
Competitors for BGC include: Alcatel-Lucent (ALU), Pirelli & C. SpA (private), Commscope Inc. (CTV), and Encore Wire Corp. (WIRE).
Potential Trades:
All of the following option trades have 46 days until expiration. General Cable is currently trading at $43.42. These trades were discovered using the powerful suite of option search tools found at PowerOptions .
| Covered Call – BICCGeneral (BGC) $ 43.42 (46) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| OPTION | Strike Info |
Opt Bid |
%Dnsd. Prot. |
%If Inch. |
%If Asgnd |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BGCCH | 07 MAR 40.00 | $4.70 | 10.80% | 3.30% | 3.30% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BGCCI | 07 MAR 45.00 | $1.90 | 4.40% | 4.60% | 8.40% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The first covered call trade, an in the money covered call, offers 10.8% downside protection and a potential profit of 3.3% if the stock remains unchanged or rises. The net cost of this trade, per 100 options, is $4,152.00.
The second covered call trade, an out of the money covered call, offers 4.4% downside protection and a potential profit of 4.6% if the stock remains unchanged. If the stock rises above the $45 strike price of the option, the potential profit becomes 8.4%. The net cost of this trade, per 100 options, is $3,872.00.
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[tags]Northeast Utilities Services Co., United Illuminating Co., Silec Cable, Middletown, Norwalk, Connecticut, Bethel, Bernard Ernot, Pirelli & C. SpA, ALU, Alcatel-Lucent, BGC, BICCGeneral, CTV, Commscope Inc., WIRE, Encore Wire Corp., covered call investment strategy, investment strategy, iron condor, poweroptions, stock option trading, stock options[/tags]