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November 5, 2020
“Weekly Options Members” make 97% potential profit by exiting the Zynga earnings trade before it reports.
For those that held their trade watch this space to see how the day pans out!
Mobile game-maker Zynga Inc (NASDAQ: ZNGA), which is heavily into acquisitions this year, has started to pay off, showing up in third-quarter results the company announced late Wednesday.
Zynga's revenue grew to a record $503 million (up 46% year-over-year) in the third quarter, with bookings of $627.96 million (up 59%), according to its latest earnings report.
This compares to year-ago revenues of $394.81 million. The company has topped consensus revenue estimates three times over the last four quarters.
Zynga also had its best mobile daily active user (31 million) and monthly active user (83 million) numbers in six years.
But, Zynga earnings also reported a net loss of $122 million. That compares to net income of $230 million during the same period last year, though that was boosted by the sale of Zynga's building in San Francisco.
During the third quarter, Zynga also closed its acquisition of Istanbul-based hyper-casual game publisher Rollic.
This caused the company to drop by about 5% at one stage before closing the after-hours trading down only 1.26%.
Zynga shares have risen 61% since the beginning of the year. In the final minutes of trading on Wednesday, shares hit $9.87, a rise of 58% in the last 12 months.
The Zynga Earnings Trade…..CLICK HERE to understand why we executed this trade.
** OPTION TRADE: Buy ZNGA NOV 06 2020 9.500 CALLS at approximately $0.30.
The Pre-Earnings Profit…..
“Weekly Options Members” entered Zynga earnings trade on Tuesday, November 03, 2020 for approximately $0.33.
These options were sold at $0.65 on Wednesday, November 04, 2020.
At one stage of trading the trade was selling for $1.31 but only one buyer.
At a later stage 2 contracts sold for $1.07.
These were very lucky profits for the traders that were selling their contracts.
However, for most of the members an approximate potential profit was 97%, which was excellent for two days in the trade.
CEO Frank Gibeau pointed to a "digital holiday" that could have big benefit in mobile gaming, with new mobile on the market, plus social distancing and lockdowns resulting in the fact that "a lot of folks aren’t going to be able to go to stores and buy gifts."
Gibeau said the team is "fully integrated at this point from an operating standpoint," but the company won't start including Rollic in its user numbers until the next quarter.
"We are well-positioned for further M&A," he added.
Future Zynga earnings is looking for FY20 sales of $1.93B, up $129M from its’ prior guidance. Bookings are expected to be $2.24b, up $41m from prior guidance.
Will Zynga Earnings Help Shares Rise Today or Continue to Fall?
Will We Recommend Another Future Zynga Earnings Trade?
What Other Trades Are We Anticipating?
Do You Wish To Be Part Of This Action?
For answers, join us here at Weekly Options USA, and get the full details on the next trade.
While there are many more areas that can help to explain option trading, this is a basic overview of what stock options are, and where and how they started.
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