Increasing Price Limit on Old Dominion February Call Options

By Linda McDonough • January 30, 2018

The ODFL February 16, 2018, call on Old Dominion Freight (ODFL) with a strike price of $150 is trading at $2.55, close to my prior $2.43 limit. Symbol (ODFL180216C150).

I am increasing the buy limit to $2.65, with the hope that subscribers will be able to fill this trade.

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Stanley

01/30/18 ‐ 11:29am ET January 30, 2018 at 11:29am ET

WERN filled for.50 @ Fidelity
Still working on SAIA midpoint is 2.90

John

01/30/18 ‐ 12:01pm ET January 30, 2018 at 12:01pm ET

Linda

Im confused . I didnt see a Feb 16 call . My order was filled for Feb 18 last week .

john

Linda McDonough

01/30/18 ‐ 1:48pm ET January 30, 2018 at 1:48pm ET

I think we are both right. The call expiration is Feb 16, 2018.

John

01/30/18 ‐ 1:50pm ET January 30, 2018 at 1:50pm ET

linda ,

thanks . just checking

john

George McMillion

01/30/18 ‐ 12:41pm ET January 30, 2018 at 12:41pm ET

WERN filled at $.45 on TDA

Stanley

01/30/18 ‐ 2:02pm ET January 30, 2018 at 2:02pm ET

ODFL filled for 2.70 @ Fidelity

Nils Mellquist

01/31/18 ‐ 10:04am ET January 31, 2018 at 10:04am ET

There is no liquidity in these options. Options Market pricing in big move and CH Robinson had good #s today. I went ahead and paid $3 for the 2/16 150s. Can’t get too cute on trying to bottom tick an illiquid market. If the fundamentals come through, the options will make $$

Victor

02/02/18 ‐ 10:09am ET February 2, 2018 at 10:09am ET

ODFL filled @ 2.65

Mike D

02/02/18 ‐ 10:42am ET February 2, 2018 at 10:42am ET

ODFL filled at 2.65

Linda McDonough

02/08/18 ‐ 9:47am ET February 8, 2018 at 9:47am ET

Subscribers-

A quick update on ODFL who reported this morning:

Old Dominion Freight (NSDQ: ODFL) reported what I think is a good quarter. Revenue beat estimates by $13 million and earnings by $.03. Unlike most public companies, Old Dominion did not offer an earnings number adjusted for a regular tax rate. It did quantify the absolute dollars of benefit and a $9.8 million special bonus paid due to the tax benefit.

Backing out both those numbers show earnings of $1.15 versus estimates of $1.13. All metrics pointed in the right direction, with costs declining to 83.9% from 84.8% last year and rates up 5.1%.

It’s incredibly frustrating when I get the news that I am looking for in a stock (or a group of stocks as it is with these LTL shippers) but NOT the price action. In fact, all three (ODFL, SAIA, and WERN) have traded down on what I perceive to be very strong quarters.

The company’s call is at 10 AM when hopefully management will turn the bearish sentiment around.

I attribute the weakness to portfolio rebalancing where some managers might be shifting out of transportation stocks due to fears that higher interest rates will derail economic growth. I totally disagree with this argument as the shippers are in a secular wave of growth, partly due to a strong economy but also due to a shrunken supply of available trucks due to weaker players being shut out of the market and increased demand from e-commerce.

As companies like Amazon (NSDQ: AMZN), Jet (part of Walmart (NYSE: WMT) and Boxed promote home delivery of household items and groceries, demand for LTL shipping will expand.

This doesn’t help us much with the options, which have a limited shelf-life but reinforces my bullish view of the group. The ODFL call options expire next week so the only hope is that the stock has a quick rally. However, the SAIA and WERN calls have until mid-March to improve.

Ajax

02/08/18 ‐ 10:13am ET February 8, 2018 at 10:13am ET

Thanks for the update Linda. I went back and re-read your initial alert on these truck companies and I decided that given where the options are now, but more importantly given where the stock prices are now, I feel the outright purchase of the stocks is a good idea. I think the time value decay on the options was ruining my mood, but I like the idea of these stocks doing well over the long haul (yes, pun intended) and I will enjoy the trip better by owning the stocks. I’m guessing we’ll have them for a while yet, beyond the options expiries.

Victor

02/13/18 ‐ 9:18am ET February 13, 2018 at 9:18am ET

GM Linda, Any plans to roll the ODFL call? or do we let it expire worthless

Stanley

02/13/18 ‐ 2:20pm ET February 13, 2018 at 2:20pm ET

Hi Linda,
I would like to hear from you as well on ODFL call.
Roll or let it expire.
thanks

Linda McDonough

02/13/18 ‐ 4:02pm ET February 13, 2018 at 4:02pm ET

Hi Stanley and Victor,
I usually do not roll the options as the expiration date was chosen to coincide with the earnings release and these collapsed in value so quickly. I think the stock will go higher so it’s not necessarily a bad idea.
I will see how the options trade tomorrow to see how much value there is on a roll. If I think the roll is a good strategy you will see a trade alert. No alert means letting them expire.
Best,
Linda

Victor

02/13/18 ‐ 5:04pm ET February 13, 2018 at 5:04pm ET

Thanks much. Will look forward for your direction

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