Bloomberg TV: How to Trade SL Green Realty Ahead of Earnings

  • SL Green Realty Corp (SLG) is a constituent of the DESK Index

  • Trade: Covered Call

  • Buy SLG equity at $95

  • Sell the November $105 Call for $3

SL Green Realty Corp., an S&P 500 company and New York City’s largest office landlord, is a fully integrated real estate investment trust, or REIT, that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties.

Benchmark’s Kevin Kelly went on Bloomberg TV to discuss an options trade on SL Green (SLG) to position into the company’s upcoming earnings report.  Recently, SL Green has ramped up share buybacks in an attempt to close a 25-30% gap between its share price and the value of underlying assets. In 2017, the company boosted its repurchase program to $1.5 billion, which it plans to fund with proceeds from its active asset-disposition program.

Other points include:

  • Earnings on 4/18
  • Implied volatility is high at 28%

SL Green’s Occupancy (including leases not-yet-commenced) ended 2017 at 95.3%, which should support robust same-store NOI growth in 2018. SL Green expects cash NOI to grow at least 6%, well-above last year’s 2% gain.

Click the play button to watch full video below:

2018-04-27T22:31:36-04:00