11/18/24 :: VROCKSTAR :: 
PEP
LT valuation too cheap <$160
- not going anywhere. snack king. 18x next year PE for that is, respectfully, Mr. Market, "too cheap".
- 5% FCF yield better than cash, and growing EPS in mid singles range.
- on it's SPXEW pair, holy cow - lowest ever - looks like this company is headed to oblivion (it's not)
- one of those rare period in mkt where stonks favor the energy + bitcoin + AI complex (and i don't disagree! i own bitcoin, utility solar and meta/tsm!), but AI is not coming to disrupt snacks anytime soon, ironically one of those weird long "hedges" i search for. it's a safety trade (staple, pricing power, global footprint, valuation cheap)
- cheap can always get cheaper, i'm no stranger to this
- so what i've done is taken long dated jan 17 2027 ITM $140C action in order to keep my size smallish near 1% but give myself the 4-5x leverage bump. my thinking is... any move higher and i probably just marinate and let this thing go to work and don't have to stress. any lower, and i can set that expiry lower and perhaps go larger, or even own shares (which i can sell calls on over time). but for now i want exposure at the current px but also want to keep my cash balance high.
Thoughts?
V
PEPLT valuation too cheap <$160
- not going anywhere. snack king. 18x next year PE for that is, respectfully, Mr. Market, "too cheap".
- 5% FCF yield better than cash, and growing EPS in mid singles range.
- on it's SPXEW pair, holy cow - lowest ever - looks like this company is headed to oblivion (it's not)
- one of those rare period in mkt where stonks favor the energy + bitcoin + AI complex (and i don't disagree! i own bitcoin, utility solar and meta/tsm!), but AI is not coming to disrupt snacks anytime soon, ironically one of those weird long "hedges" i search for. it's a safety trade (staple, pricing power, global footprint, valuation cheap)
- cheap can always get cheaper, i'm no stranger to this
- so what i've done is taken long dated jan 17 2027 ITM $140C action in order to keep my size smallish near 1% but give myself the 4-5x leverage bump. my thinking is... any move higher and i probably just marinate and let this thing go to work and don't have to stress. any lower, and i can set that expiry lower and perhaps go larger, or even own shares (which i can sell calls on over time). but for now i want exposure at the current px but also want to keep my cash balance high.
Thoughts?
V
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.