Stock Option Investment Advice

Coinstar’s Stellar Call Options Volume

Coinstar’s (CSTR) call option volume was significantly up on Friday and its stock price was down almost 9%.

If you’re looking to rent a DVD or get rid of all of your pocket change, then Coinstar is the company for you. Coinstar provides DVD rental kiosks and self-service coin counting machines.


Coinstar’s primary competitors are Blockbuster (BBI) and Netflix (NFLX).

Blockbuster provides DVD’s via the standard brick-and-mortar retail stores and also provides movies for download via the Internet. Netflix provides DVD’s via mail and via the Internet.

Coinstar’s recent earnings report wasn’t as good as the analysts expected, but still turned in a revenue increase of 46% over the previous year, which is pretty good considering the economical environment over the last year.

Coinstar has some issues going forward with some of the large movie producing studios, Universal Studios, 20th Century Fox and Warner Brothers, as they have decided not to provide Coinstar’s Redbox kiosks with DVDs on the day they are released to retail. This is a setback for Coinstar, but one that can be worked around.

Sign up now for PowerOptions 14-day free trial

Coinstar’s stock price took quite a haircut after their earnings report. Coinstar’s stock price is up almost 100% from its low in December of 2008 and well off of its two-year price around $39.

CSTR Chart

Coinstar’s stock price is currently below is 50 and 200 day moving averages, its most recent support level and it’s lower Bollinger band.

Coinstar’s out-of-the-money call options experienced high volume on Friday of last week. The November 30 call option had significant action and the November 35 and December 30 call options also had some action.

See what the stock option experts are doing
Sign up now for PowerOptionsApplied 30-day risk free trial

Coinstar looks like it has been thrown out with the bathwater and a covered call investing position for Coinstar for December looks attractive with a %if unchanged potential return of 3.8% and a potential %if assigned potential return of 7.4%. The timeframe for realization of the potential profit is 40 days and the call option of interest to sell would be the December 30 with ticker symbol QLRLF.

Free stock option newsletter
» return goal > 2% / month
» works in any market

To enter the covered call investing position an investor would purchase the stocks in multiples of 100 shares for their trading portfolio and sell one call option for each 100 shares of stock purchased for their personal stock portfolio.

Want to protect your portfolio/401K from market downside?
yet still benefit from market upside
Sign up now for the free Sketch

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.

Learn how to profit from winner stocks
and protect yourself from loser stocks
Download free Trade Simulator now

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.

Learn to trade like the pros
Signup for free Webinars now

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] Internet, Universal Studios, 20th Century Fox, Warner Brothers, Redbox, kiosks, DVD, BBI, Blockbuster Inc., CSTR, Coinstar Inc., NFLX, Netflix Inc. [/tags]

Leave a Reply

Your email address will not be published. Required fields are marked *