| Hey traders, Lance Ippolito here! Welcome to our Weekly Rundown, where we'll share some of our top trading ideas — and our biggest winners!
Video game retailer GameStop, the meme "stonk" of the century so far, is back in the news with a planned "at the market" secondary share offering.
Following the company's announcement, GameStop Inc. (NYSE: GME) shares tumbled more than 12.5% before rebounding.
Now here's the deal… GameStop's secondary share offering aims to raise capital by increasing its number of outstanding shares by 3.5 million. The company has about 70.03 million shares outstanding right now, with 21.18% of those held by insiders. Its plan is to use the generated cash to speed its "corporate transformation."
Basically, with more shares available to the public, prices will likely go down. And, yes, this may attract a fresh flock of would-be meme stock investors hoping to buy the dip.
Breaking Down 'GameJunk's' Secondary Offering…
The GameStop party went on not just all night, but all week... probably even all month. It went on so long, the D.J. left and a new one was hired.
Literally, the Chief Financial Officer and the Chief Commercial Officer left the company a couple of weeks ago in late March. Yet the company still decided to issue a secondary share offering.
I really only have one question… What is left to be bullish about? Seriously.
Executives of companies make most of their income off of the shares they sell, not a salary. So after the way-too-long party, when GameStop shares moon shot to $500, two of their executives leave. They made their money on the moon and decided to stay there.
Premarket at the announcement, shares were at around $150. They then went up, when shares typically drop after more shares become available. And for what? For a dream and a meme?
I'm going to be honest. I don't see much left in the tank for GameStop as a company. There's not enough to get excited about in my opinion. Of course, shares were trading around $160 Friday afternoon, so the party could go on a bit longer…
Now on to some...
BIG Wins!
This week we cashed out a big winner in my Free Riders Club service, and it's on Ardelyx Inc. (Nasdaq: ARDX). We opened this position ahead of the upcoming Prescription Drug User Fee Act (PDUFA) on April 29. If results are positive, the underlying stock could rise $4 to $5. This is a solid risk vs. reward setup after this name had big, positive news back in September 2019 when shares doubled.
A few days after entering this position, we sold half our contracts for a 57% gain! We're holding the remainder for now.
- +56.52% on ARDX (May 21 $7.50 CALL).
- Entered on March 31 at $1.15 a contract.
- Exited half our position on April 5 at $1.80 a contract
So check out my Free Riders Club to get in on more BIG winners like this!
If you have a big score you'd like to share with your fellow Future of Wealth readers, email us your screenshots of the trade and/or any details you want to share at wptestimonial@gmail.com, and we'll celebrate them here!
Stop Wasting Time Staring At a Computer Screen
Most traders don't know this… but traditional investing research is becoming obsolete.
And that means the hours and hours spent studying stock charts and squinting at spreadsheets is a massive waste of time.
In it, I show everyday investors how to capture predictable profits with trades that have netted members multiple 50-plus percent gains overnight so far this year.
Don't miss the chance to collect these 24-hour windfalls!
Our Members-Only Pick of the Week
Finally, just for our VIP members, we have our free pick of the week from our 3D Profits service, and it's on Wendy's Co. (Nasdaq: WEN).
As WEN shares look for a trendline breakout to the upside after a year of trading sideways, we saw some insider buying to the tune of about $140,000. The July expiration also captures earnings in May, so we entered a long position on the stock at $21.40, right near where it was still trading Friday afternoon.
If you're trading the option...
- Enter at no more than $1.65 a contract with a $3.30 profit target.
Signing Off
If you're looking for more compelling trade ideas and stock market musings to read and help you prepare for what lies ahead, here's what other experts at WealthPress are saying:
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