MA trade
Congrats to MA, solid numbers yet again. That is the 3rd time the stock reacted positively after earnings (in a row). The one thing I noticed after the postive announcements, after the pop, is that MA goes through a period of consolidation.
The stock should see this consolidation again. The stock usually trades with a PEG of around 1.59-1.66. Going forward, this should not change. Using a price of 277, and a 8.20 est. 2008 earnings, with a 5yr growth of 20% (what analysts usually asign it), MA’s PEG is 1.68.
NOTE: I know MA is growing faster than 20% analysts consensus, and will continue to beat estimates, as their management knows how to handle the street very nicely. If more realistic estimates were involved with MA, its PEG would be around 1.2-1.3. But this does not mean it should move to a PEG of 1.68 with the more realistic estimates.
I am using the MA 260 June Puts.
