Amazon Stock Hits 25-Year Low
Amazon's stock has been trading at an EV/EBIT ratio of 22 times, its lowest in 25 years. This metric, which normalizes for free cash flow and capital expenditures, suggests that Amazon may be a good opportunity for investors in the short term.
According to Travis and Carlisle from The Acquirers Podcast, selling puts on Amazon has been successful in recent trades. One example was selling a put at $250, resulting in collection of a premium when exercised, and then selling a call at $260, allowing ownership of the stock at break-even.
Value Options Letter combines value investing with conservative Buffett-style options strategies, including cash-secured puts and covered calls. The publication recommends ongoing trade suggestions focused on businesses it believes are worth owning.