TRADE INSTRUCTIONS
Date: June 29, 2017
Name: NIKE, Inc.
Symbol: NKE
Type: Short Sale or Long Put
Limit: N/A

Reminder: 3TL stand for 3-Time Loser, which means this alert if for a stock that I believe is at risk of declining in value soon so the appropriate trade would be either a short sale or long put, but DO NOT GO LONG! And since you can play it a number of ways with put options in terms of strike prices and expiration dates I’m leaving it up to each of you to decide what, if anything, you want to do with it.

For that reason it will not be tracked in our portfolio. This trade is not a substitute for our usual buy recommendation but is simply an extra “bonus pick” for you to consider. Here’s why this stock qualifies as a 3-Time Loser according to my system.

TRADE RATIONALE
I realize this is very short term notice, but NKE popped up on my screen today because, (1) it is one of the lowest-scoring stocks in the S&P 500 according to my IDEAL Stock Rating System, and (2) the company is releasing quarterly earnings today after the market close which could result in a quick profit in its put options.

Unlike most 3TL alerts which are more quantitative and technical in nature, in this case I feel NKE must have been affected by the retail slowdown over the past six months and is likely to tamp down sales expectations for the remainder of the year in its forward guidance. Given the urgent nature of this alert I don’t have time to document my case for that, but suffice to say that many of the retail outlets selling NIKE products have reported declining sales for their stores during the previous quarter so it is not unreasonable to infer that the same trend may apply to one of their biggest brands.

Unfortunately, I can’t prove that, and by tomorrow morning it may be too late to act on it if my hunch proves correct. FWIW, MarketWatch reported earlier this morning unusual options straddle activity suggesting a big price move may be on the way. That’s not a lot to go on, but if you are feeling lucky and need a little action before the long holiday weekend, this is one bet that looks pretty enticing to me.