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Technology Stocks : Cohu, Inc. (COHU)
COHU 14.41+1.1%Oct 14 4:00 PM EDT

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To: bobbyl who wrote (6685)7/10/2019 6:22:39 AM
From: robert b furman  Read Replies (1) of 6731
 
I also wrote this is the hardest stock in the world to own.

The extra 30 million shares that went to the Excerra stockholders are finding that out (so too are we again).

I'm using this dip as an opportunity to get more shares.

Once this company has shed 40 million in cost - it will be a very solid money maker - whether systems are sold or not.

The consumable business will carry Cohu profitably during cycle troughs.

I do wish I'd swapped some Cohu for both TER and AMAT, but I didn't.

I never look back and do the Woulda Coulda Shoulda.

Hindsight is 2020 - not fair to beat yourself up over not being perfect.

I'm not perfect and never expect to be.

While we're talking about making money, when Cohu is this cheap, we get the following:

Dividend of 24 cents
Put premium of 49 cents on $10.00 that expire in February ( 7 months out - 84 cents annualised)
Put premium of 1.05 on 12.50 puts that expire in February ( 7 months out - 1.80 annualised)

That's $2.88 on a stock you can buy all day long for $15.00 yesterday. That leaves a return of 19.2%.
Even if you paid 27.00 for the shares, it is a 10.7 % return.

This is the time when owning Cohu pays the most - because it is cheap in price.

Sell puts and BUY THE DIP Bobbyl.

That's my approach.

I'm not ashamed of myself - I'm taking advantage of others fear.

By the way - I didn't pay $27.00 for Cohu.

So far I've had 3000 shares assigned to me with an average cost in the upper 16.00 - ish. I"ve reduced then to under 15, when I subtract expired May puts that have generated put premium that I've kept.

This stock is hard to own, but there are several ways to make money on the stock when it gets this cheap.

Yesterday the $12.50 February puts traded for $1.32 and the $10.00 February puts sold for 40 cents.

They may get even more today - what's not to like about a one time blast of the dividend - 24 cents, 7 months of premium (not annualized = 1.32 + .40 = 1.72 +.24 = 1.96 / 15.00 = 13% return for a one time 7 month play.

I've been posting these techniques for years now. I'm not ashamed of myself - I'm making money on the opportunity.

I'm buying the dip by utilising the selling of puts on a great stock that has gotten cheap!!

One word of caution, NEVER sell puts on a stock you do not want to buy more of.

I'm more than happy to get the 12.50's assigned to me at a price of $11.18 and 10's assigned to me at $9.60.

That's just me - every investor should do their own diligence!

Bob
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