Microsoft (MSFT) Offering Possible 43.68% Return Over the Next 16 Calendar Days

Microsoft's most recent trend suggests a bullish bias. One trading opportunity on Microsoft is a Bull Put Spread using a strike $220.00 short put and a strike $215.00 long put offers a potential 43.68% return on risk over the next 16 calendar days. Maximum profit would be generated if the Bull Put Spread were to expire worthless, which would occur if the stock were above $220.00 by expiration. The full premium credit of $1.52 would be kept by the premium seller. The risk of $3.48 would be incurred if the stock dropped below the $215.00 long put strike price.

The 5-day moving average is moving up which suggests that the short-term momentum for Microsoft is bullish and the probability of a rise in share price is higher if the stock starts trending.

The 20-day moving average is moving up which suggests that the medium-term momentum for Microsoft is bullish.

The RSI indicator is at 68.39 level which suggests that the stock is neither overbought nor oversold at this time.

To learn how to execute such a strategy while accounting for risk and reward in the context of smart portfolio management, and see how to trade live with a successful professional trader, view more here


LATEST NEWS for Microsoft

Stanford Scientists Create a Billionaire Factory
Tue, 29 Dec 2020 08:00:20 +0000
(Bloomberg Opinion) — One of the most unsettling developments in business in 2020 was the trend for electric-vehicle companies to list on a stock exchange before they have their first revenues. Though standard practice for research-intensive life sciences companies, going public before you have a purchasable product is pretty unusual in the automotive world.And yet, pre-revenue companies such as Nikola Corp. and Fisker Inc. have achieved multi-billion dollar valuations. Now, Californian battery start-up QuantumScape Corp. has taken electric-vehicle mania to a new level. Founded by Stanford University scientists a decade ago, with financial backing from Volkswagen AG, QuantumScape became a public company in November after merging with Kensington Capital Acquisition Corp., a special-purpose acquisition company. The company won’t generate significant revenue until 2026, but it’s already valued at $43 billion, or $51 billion on a fully diluted basis.(1)From a climate perspective, it’s great that investors are committing capital to electric transport. The promise of such riches will encourage others to join the emissions-cutting cause. However, the same speculative fever that has propelled Tesla Inc. and China’s NIO Inc. appears to have taken hold of QuantumScape investors.An average of $2.8 billion of the battery company’s stock was traded daily during the past week. That’s more than the volume for Alphabet Inc., whose market capitalization is $1.2 trillion. Technical factors may have contributed to QuantumScape’s surge: Only a small percentage of the shareholder register is available to trade.(7) For retail investors who buy stock at these levels, there’s a long way down.First, the good news. In laboratory tests QuantumScape’s “solid state” battery cells have achieved very encouraging results, which suggest the innovative chemistry could one day enable electric vehicles to travel further and be charged faster, at lower cost.(2) This is exciting because it’s become harder to extract significant performance gains from conventional lithium ion batteries. Chief Executive Officer Jagdeep Singh’s team of scientists appears to have pulled off a real feat. However, when the SPAC deal was announced in September the parties decided a $3.3 billion valuation was appropriate.(6) This seemed ample for a company with fewer than 250 employees and one which doesn’t have a finished product or factory. Following a blistering stock-market run, QuantumScape is now worth more than 10 times that initial value, and more than automakers like Ford Motor Co. and battery giants such as Panasonic Corp. and Samsung SDI.Those who bought shares in the Kensington SPAC in August have enjoyed a 1,060% return, while QuantumScape warrants that once sold for 80 cents are now worth 50 times as much.(3) The three Stanford founders — Singh, Fritz Prinz and Tim Holme — have become paper billionaires. Volkswagen, which invested about $300 million in QuantumScape, will own a 23% stake worth almost $10 billion. (4)As is often the case with SPACs, the Kensington sponsor — controlled by Justin Mirro, a former Moelis & Company and RBC Capital Markets investment banker — has also done well. It received shares and warrants worth more than $900m, a huge return on its $7 million or so investment and one achieved with only a few weeks work.(5)QuantumScape’s other prominent backers include venture capital firms Khosla Ventures and Kleiner Perkins, Microsoft Inc. cofounder Bill Gates, hedge fund billionaire George Soros’s Quantum Partners and investor Jeremy Grantham. JB Straubel, a former chief technology officer at Tesla, is on the board. Such endorsements, and the years of R&D that have gone into the batteries, suggest there’s more here than just hype. The contrast with Nikola, whose own technology (or lack of it) was the subject of a scathing short-seller report, seems clear.(8) Volkswagen’s production expertise should smooth the path to commercialization. The partners plan to start production at a small pilot facility in 2024, and then at a much larger factory two years later. But success isn’t guaranteed.So far QuantumScape has only produced single-layer cells and it still needs to find a way to stack more than 100 on top of each other to create a battery package. Competitors such as China’s Contemporary Amperex Technology Co., won’t sit by idly. CATL’s shares have also surged this year, valuing it at about $110 billion.One advantage of SPACs is that they’re allowed to publish detailed multiyear financial forecasts, whereas companies that go public via a traditional initial public offering usually only publish historic finances. Given QuantumScape’s significant production hurdles, it would be imprudent for investors to over-rely on these estimates, but whatever happens they’re in for a long wait: Even assuming QuantumScape’s forecasts prove accurate, the valuation looks disconnected from reality. The market capitalization is equivalent to 13 times the revenue the company hopes to generate in 2027. Tesla shares are also incredibly frothy but they’re a comparative steal at slightly more than 13 times its expected revenue in the next 12 months. Volkswagen, which will be QuantumScape’s biggest customer at first, is valued at just 0.3 times next year’s sales.QuantumScape’s batteries may end up propelling the next generation of electric vehicles, but sustaining that valuation could prove even more challenging than advanced battery chemistry.  (1) The fully diluted 447.5 million share count includes unexercised stock options, restricted stock units and additional shares issuable to Volkswagen(2) The SPAC's public shareholders account for only 5% of the shareholder register. Existing QuantumScape shareholders hold 82%, some of whom aren't sellers or are subject to lock-ups.(3) QuantumScape’s design doesn’t require a manufactured anode, which keeps costs down. The lithium-metal anode is formed when the cell is charged.(4) When adjusted for QuantumScape’s cash(5) If QuantumScape elects to redeem them, the warrants will convert to a maximum of 0.365 shares(6) Volkswagen owns 71 million shares of QuantumScape but will be issued another 15 million subject to achievement of a technical performance milestone, according to the S-1.(7) Kensington sold shares in an IPO on June 30 and had already signed a non-binding letter of intent with QuantumScape just three weeks later(8) QuantumScape also has far more patents, for example.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Dow Jones Futures: Stock Market Rally Hits Highs On Apple, Amazon, These Giants, But Growth Has Bad Day
Tue, 29 Dec 2020 02:44:54 +0000
The major indexes hit record highs Monday as Apple stock, Amazon and Google led a big-cap rally. High-octane growth stocks fell.

Dow Jones, Up 765 Points In December, Hits New Highs; When To Buy Microsoft
Mon, 28 Dec 2020 21:44:37 +0000
Besides Microsoft, a few more of the so-called FAANG tech megacaps also got discussed on Monday's IBD Live show.

Apple Leads Big Tech Higher and Closes at a Record
Mon, 28 Dec 2020 21:34:31 +0000
(Bloomberg) — Shares of mega-cap technology and internet companies rose on Monday, with the group extending strong 2020 advances.Apple Inc. rose 3.6% to end at an all-time closing high, though it fell short of reaching an intraday record. The stock has risen more than 85% this year, and it is poised to close out its second straight annual gain above 80%.The stock is up more than 25% since the start of November, with recent gains coming on a report that Apple plans to build a self-driving car and is targeting 2024 to produce the vehicle. In a note dated Dec. 27, Piper Sandler wrote that an electric-vehicle revenue stream “could add another leg of growth in addition to a higher multiple” for Apple.Among other stocks, Facebook Inc. rose 3.6% on Monday, Amazon.com Inc. added 3.5%, and Google-parent Alphabet Inc. climbed 2.3%. Microsoft Corp. closed up 1%, as did Netflix Inc. All have outperformed the broader market this year; Alphabet is the weakest performer of the bunch, up 32%, but that move is still roughly double the 15.6% rise of the S&P 500.The S&P 500 Information Technology Index rose 1.2% to close at a record. The Nasdaq-100 Index added 1% on Monday, roughly in line with the 0.9% gain of the S&P 500, which hit an all-time high. Broader markets got a boost after President Trump signed a $2.3 trillion Covid-19 relief and government funding package.While big-cap tech rose, some of the market’s most prominent “stay-at-home” stocks underperformed. Zoom Video Communications fell 6.3%, while Peloton Interactive lost 6.5% and Shopify declined 6.4%.(Updates to reflect close of regular trading)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Apple Stock, CMG, PYPL Among Top Tech Stocks, Retailers To Watch
Mon, 28 Dec 2020 21:05:37 +0000
As Tesla, PayPal, Shopify and other tech stocks and retailers show strength, Apple stock, MSFT, CMG and IPO stock Maravai test new buy zones.

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