In its most recent edition, Entrepreneur Magazine released its pick for the top nationwide franchises for 2007. The magazine takes an in-depth look at which franchises would make the best investment for its hopeful readership. In this installment of the PowerOptions weblog, we take a look at some of the publicly traded companies on the list and research the potential option trades.
Audio Podcast:
An audio podcast of this article is available at: poweropt.com/podcasts/2007_04_05_Franchises.mp3
The top two companies this year are the privately owned Subway and Dunkin’ Donuts chains. Great companies with great sandwiches and coffee, but until they go public we’re stuck giving them a passing reference.
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Below is the list of the top 10 franchises:
1) Subway – Privately Owned
2) Dunkin Donuts – Privately owned by the Carlyle Group
3) Jackson Hewitt Tax service (JTX)
4) 7-11 – Private subsidiary of Seven-Eleven Japan Co.
5) UPS (UPS)
6) Dominoes Pizza (DPZ)
7) Jiffy Lube – Subsidiary of Royal Dutch/Shell (RD)
8) Sonic Drive In – Privately Owned
9) McDonald’s Restaurants (MCD)
10) Papa Johns Pizza (PZZA)
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Potential Trades:
All of the following option trades have 45 days until expiration. These trades were discovered using the powerful suite of option search tools found at PowerOptions.
| PowerOptions covered call search (45 days) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock Sym |
Stock Price |
OPTION | Strike Info |
Opt Bid |
% Dnsd. Prot. |
% If Unch. |
% If Asgnd |
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| DPZ | $33.54 | DPZEG | 07 MAY $35.00 | $0.55 | 1.60% | 1.70% | 6.10% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| JTX | $29.11 | JTXEF | 07 MAY $30.00 | $0.60 | 2.10% | 2.10% | 5.20% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| MCD | $45.23 | MCDEI | 07 MAY $45.00 | $1.35 | 3.00% | 2.60% | 2.60% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| PZZA | $29.68 | ZZQEF | 07 MAY $30.00 | $1.15 | 3.90% | 4.00% | 5.20% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| UPS | $68.88 | UPSEN | 07 MAY $70.00 | $1.75 | 2.50% | 2.60% | 2.70% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DPZ – Is the ticker symbol of the ubiquitous and popular Dominoes Pizza. This trade involves the May $35 call option and offers 1.6% downside protection and 6.1% potential profit if the stock is above the $35 strike price at the end of the option period. The stock is currently trading at $33.54.
JTX – Is the ticker symbol of the Jackson Hewitt Tax Service . This trade involves the May $30 call option and offers 2.1% downside protection and 5.2% potential profit if the stock is above the $30.00 strike price at the end of the option period. The stock is currently trading at $29.11.
MCD – Is the ticker symbol of the famous and even more ubiquitous McDonald’s Restaurant chain. This trade involves the May $45 call option and offers 3.0% downside protection and 2.6% potential profit if the stock is above the $45.00 strike price at the end of the option period. The stock is currently trading at $45.23.
PZZA – Is the ticker symbol of the Papa Johns Pizza chain. This trade involves the May $30 call option and offers 3.9% downside protection and 5.2% potential profit if the stock is above the $30.00 strike price at the end of the option period. The stock is currently trading at $29.68.
UPS – Is the ticker symbol of United Parcel Service. This trade involves the May $70 call option and offers 2.5% downside protection and 2.7% potential profit if the stock is above the $70.00 strike price at the end of the option period. The stock is currently trading at $68.88.
Competitors:
Competitors for DPZ include: Papa John’s International Inc. (PZZA), Little Caesar Enterprises, Inc. (private), and Pizza Hut, Inc. (private).
Competitors for JTX include: H&R Block, Inc. (HRB), Intuit Inc. (INTU), and Liberty Tax Service (private).
Competitors for MCD include: Burger King Corporation (BKC), Yum! Brands Inc. (YUM), Doctor’s Associates Inc. (private), CKE Restaurants Inc. (CKR), Jack in the Box Inc. (JBX), Sonic Corp. (SONC), Tim Hortons Inc. (THI), and Wendys Intl. Inc. (WEN).
Competitors for PZZA include: Dominos Pizza Inc. (DPZ), Little Caesar Enterprises, Inc. (private), and Pizza Hut, Inc. (private).
Competitors for UPS include: FedEx Corporation (FDX), Deutsche Post AG (private), United States Postal Service (private), and Stamps.com Inc. (STMP).
For more information about how to identify and research great option trades, visit the PowerOptions website. There you will find the data you need to make quick, clear, and informed decisions. You can trade knowing you have found the best investment. Also, PowerOptions will allow you, with a few quick clicks, to quickly and accurately compare trades. PowerOptions‘ premium customer support is second to none in the industry. They can be easily contacted when you need them at their toll-free number to answer customer questions. Call them now toll free at 877-992-7971.
PowerOptions provides a free 14-day trial of its service. So join PowerOptions today, and you too can start reaping the benefits of the covered call investment strategy.
PowerOptions‘ sister company PowerOptionsApplied provides expert stock option trading recommendations. PowerOptionsApplied specializes in covered calls, naked puts and iron condor stock options strategy recommendations. PowerOptionsApplied provides a 30-day risk free trial of its service.
[tags] Entrepreneur Magazine, Subway, Dunkin’ Donuts, Sonic Drive In, Little Caesar Enterprises, Inc., Pizza Hut, Inc., Liberty Tax Service, Doctor’s Associates Inc., Deutsche Post AG, United States Postal Service, BKC, Burger King Holdings Inc., CKR, CKE Restaurants Inc., DPZ, Dominos Pizza Inc., FDX, Federal Express Corp., HRB, H&R Block Inc., INTU, Intuit Corp., JBX, Jack in the Box Inc., JTX, Jackson Hewitt Tax Service Inc., MCD, McDonalds Corp., PZZA, Papa Johns International Inc., SONC, Sonic Corp., STMP, Stamps.com Inc., THI, Tim Hortons Inc., UPS, United Parcel Service Inc., WEN, Wendys Intl. Inc., YUM, Yum Brands Inc., covered call investment strategy, investment strategy, iron condor, poweroptions, stock option trading, stock options [/tags]