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Visa (V) - Earnings and directional options.
2 min read

Visa (V) - Earnings and directional options.

Visa (V) - Earnings and directional options.

  • Visa (V) reports Q1 earnings after the close. Consensus EPS forecast for the quarter is $1.35 vs $1.31 a year ago.
  • The expected move from the options market for the earnings event is ~3% with a 2 week expected move ~5%

The Set-Up

Visa's chart looks a lot like the market's. It's down about 14% over the past 3 months versus the SPX down about 12%. Here's the 2 month expected move in the options market from OptionsAI technology:

Ways To Play

Mastercard (MA) beat yesterday and saw a fairly substantial pop. American Express reported last week and is higher now but didn't move much on earnings. Visa is higher over the past week with most of the gains on the tail of MA's move.

The options market isn't pricing much of a move so selling the move is not great risk/reward. So let's look directionally. Here's a bullish price target of ~190 for May 15th expiration:

This is nice as a comparison versus stock as you can see the outlay of costs. The breakeven on the 180/190 call spread is $183.38 so the stock needs to get above that by May 15th just to break even. But anything above that level to $190 is in the profit zone.

With a bearish target of ~$168 here's a look at some trades, from OptionsAI technology:

Similar to the other direction, the 177.5/167.5 put spread is 10 wide, with a breakeven about $4 away from the current stock price. Its risk/reward is similar at 3/6.

Fading the move with a slightly less bearish price target (~$170) produces one credit call spread of note, the May 15th 180/185 short call spread with decent risk/reward. Here's how that looks on the chart, with a breakeven (182.90) near this week's highs:

Give OptionsAI technology a try with your own price target in AAPL HERE

Actionable Insights from the Options Market

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