The Secret to Money-Doubling Trades They Don't Want You to Know
By Nick Atkeson and Andrew Houghton
#1 Halliburton Co. (HAL)
Halliburton Co. (HAL) is expected to earn more than $2.12 per share next year. The stock fell from over $35 per share to $30 on fears that its cementing work on the BP PLC (BP) rig played a part in the oil spill, and is now down below $28 on the market sell-off. While the spill is a direct overhang to Halliburton, the stock is unlikely to show much appreciation. On the other hand, it may not show much more depreciation either, as many investors' worst fears are already priced into the stock.
Time to clean up. We recommend selling the HAL Oct 25 Puts (HAL 101016P00025000). We believe the stock is unlikely to drop below $25 per share by October expiration. If we are right, your profits would be theoretically infinite, which is a major clean up, even in mom's eyes.
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