MetroPCS’s stock has dropped significantly since the merger was announced, although that could also be because their 2012 fourth quarter net profit plunged by 65% because of higher expenses combined with lost subscribers. Earlier in 2012, Sprint had tried to buy MetroPCS for $8 billion but their board rejected the plan.  MetroPCS has argued the deal with T-Mobile is the best of competing alternatives and is urging its shareholders to approve the merger.

MetroPCS smart phone users will be able to connect to T-Mobile’s LTE networks and vice versa. The two companies will continue to operate two different LTE networks in 2013, but combine the networks in 2014. MetroPCS will be phasing out all its old CDMA networks in favor of LTE networks by 2015. Recently MetorPCS announced a collaboration with Ericsson to upgrade its LTE network hoping to attract new subscribers.

The Trade:  Buying the PCS April 11 Calls for $.41
Risk: $41 per 1 lot
Reward: Unlimited
Breakeven: $11.41

Greeks of the Trade:
Delta: Long
Gamma: Long
Vega: Long
Theta: Short

—
Andrew Keene
President/Founder
Andrew@KeeneOnTheMarket.com 

Paper bought 922 JAZZ April 55 Puts for $1.10 when stock was trading $57.45
Paper bought 800 PLCM May 10 Puts for $.50 when stock was trading $11.29
Paper bought 1600 TRQ May 5 Puts for $.15 (2.2 times usual volume)nwhen stock was trading $6.40
Paper bought 3750 ARMH April 38 Puts for $.65 (3.4 times usual volume) when stock was trading $40.07
Paper sold 2000 SPRD May 19 Puts for $1.20 (4.1 times usual volume) when stock was trading $19.50

Paper bought 1000 OSGIQ Jan 2014 5 Calls for $.30 (9.8 times usual volume) when stock was trading $2.94
Paper bought 1000 KLAC April 55 Calls for $.30 (2.2 times usual volume) when stock was trading $51.36
Paper bought 1000 COCO May 2 Calls for $.35 (16.2 times usual volume) when stock was trading $2.22
Paper bought 500 DSX April 10 Calls for $.10 (5.5 times usual volume) when stock was trading $9.24
Paper bought 500 GNK May 4 Calls for $.15 (3.4 times usual volume) when stock was trading $3.08

Paper bought 4687 PCS March 28th 11 Calls for $.15 when stock was trading $10.60
Paper bought 10,000 HUM April 67.5-60 Put Spread for $2.95 (6.1 times usual volume) when stock was trading $68.57
Paper sold 2000 SPRD May 19 Puts for $1.20 (4.1 times usual volume) when stock was trading $19.50
Paper bought 1910 JNPR May 20 Calls for $.68 when stock was trading $18.68
Paper sold 1000 BMC April 47 Calls for $1 (5.1 times usual volume) when stock was trading $45.44

GES shares are lower by over 4.5% this morning after the company issued disappointing guidance for Q1 and 2014. GES issued EPS guidance in the range of $0.05-0.10 when the analyst community was expecting $0.29. In related news, Wedbush Securities maintained a buy on GES shares, even after the gap down today.

JBL shares are currently down about 4.4%. The firm missed by roughly a penny, but the forward guidance is really why Wall Street is selling. For Q3, the firm expects revenues in the range of $4.3 to $4.5 B and EPS between $0.50-0.58. The analyst community was expecting $0.61 and 4.51B.

salerno.mark.a@gmail.com

Paper bought 500 RES June 17.3 Puts for $2.30 (8.8 times usual volume) when stock was trading $15.81
Paper bought 9665 HUM April 65 Puts for $1 (3.3 times usual volume) when stock was trading $70.44
Paper bought 1500 AMJ April 43 Puts for $.70 (3.2 times usual volume) when stock was trading $43.65
Paper bought 770 CNQ May 65 Puts for $2 (7.8 times usual volume) when stock was trading $69.26
Paper bought 4000 GGB June 7 Puts for $.30 when stock was trading $7.52

Paper bought 1000 MPO May 7.5 Calls for $1.40 (3.5 times usual volume) when stock was trading $8.54
Paper bought 1000 SOXL April 36 Calls for $32.5 (12.2 times usual volume) when stock was trading $37.57
Paper bought 4890 TRI May 35 Calls for $.35 (53.1 times usual volume) when stock was trading $32.31
Paper bought 1650 IR June 60 Calls for $1 (6.2 times usual volume) when stock was trading $56.47
Paper bought 2000 RFMD May 5 Calls for $.40 (3.1 times usual volume) when stock was trading $4.96

Paper bought 8760 DAL Sep 17 Calls for $1.87 (2.3 times usual volume) when stock was trading $17.03
Paper bought 19,361 S Aug 5 Calls for $.15 (5.1 times usual volume) when stock was trading $6.05
Paper bought 9925 GM Jan 2014 30 Calls for $2.74 when stock was trading $29.23
Paper sold 5000 May 45 Puts for $.975 (3.0 times usual volume) when stock was trading $46.30
Paper sold 1520 SNSS July 5 Puts for $.60 (13.6 times usual volume) when stock was trading $5.50