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Covered Call Sell in Advertising

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I’ve promised the Irregulars that I’ll keep you up to date on my personal purchases and sales in the stocks that I write about, so I need to let you know that I sold my Criteo (CRTO) position on Friday.

Not because I particularly intended to do so, though I’ll take the small short-term profit, but because I sold covered calls when I increased my CRTO position a couple weeks ago, and the shares just eked above $45 to trigger those options and call my shares away after the close on Friday. That meant a nice little 8% return in two weeks (if I was promoting a newsletter, that would be a 226% annualized gain!), but I would have been just as happy to see the shares at $44.99 on Friday so I didn’t have to go through the transactions and immediately decide when or if to re-purchase that CRTO position.

I haven’t yet re-opened that position in Criteo shares, but I remain positive about the company’s prospects and think they’re the strongest of the small ad-tech firms (not least because they’re the most consistently profitable, and have a very sticky customer base). The stock is at a new high for the year now (the calendar year, not 52 weeks — it was close to $60 for a while last Summer), and is still priced for substantial growth, so in the absence of a big surprise takeover bid I expect I’ll have the opportunity to watch and wait for a dip or, perhaps, sell some puts to offer to rebuild that position at a lower price (I could, for example, have sold the June $45 puts today and either gotten back into the shares at $43.25 over the next few weeks or generated another 4% gain… or an “annualized return of 75%!”).

I’ll let you know if I do anything — my tendency is generally for inaction, so I may need a few more cups of coffee and another read through their filings to help me make a decision. So I sold my CRTO, but I still like the company — read into that what you will 🙂

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