Trade Alert: Fast Times at Apollo High

Our largest short is down 8% this morning after another disastrous earnings report. The biggest reason for the sell off is this:

Revenues declined at the University of Phoenix in the reported quarter due to a 12.2% decrease in degreed enrollment to 355,800 students. New enrollment growth was up only 1% from the prior-year period, a disappointment from management’s original expectation of maintaining the sharp 13% rise witnessed in the sequentially preceding quarter. In late February 2012, management had however tempered its growth expectation to the low single digits.

I guess 1% growth meets their “low single digit” target, but Wall Street is running for the hills as the growth story at Apollo has disappeared.

I’m going to sell maybe 1/5 of my APOL puts this morning to lock in a 500% plus gain and I’ll probably hold the rest for now. It remains my biggest short because these calls have kicked in so big.

Amazon’s up 8% plus over the last couple days itself. I’ve still got the calls in that one and they are starting to become a big position too as Amazon has rallied. Still holding them for now, but I wanted to address the huge Amazon pop.

Rock on, indeed, eh?!