Price Forecast:

Bullish Case: DVA may rebound due to positive sentiment from operational performance and strategic acquisitions. Historical data suggests potential for price recovery given recent stability and favorable market conditions.

Bearish Case: Continued competitive pressures and negative returns on capital could undermine DVA's price, as seen in past trends which show significant sell-offs and high institutional put volume.

Potential Outcomes:

1. Recovery from market reaction (30%): If operations strengthen amidst competition.
2. Further decline due to competition (40%): Ongoing pressure from competitors impacting revenues.
3. Stabilization around current levels (20%): Price may stabilize if investor sentiment balances.
4. Increased volatility (10%): Unforeseen events could escalate uncertainty.

Trading Oracle: Engage in a bullish credit spread by selling 2 $165 puts and buying 3 $160 puts, targeting a price recovery with approximately 72% odds of profit and projected returns around 15%. Favorable risk/reward ratio considering the current implied volatility structure suggests this strategy captures upside efficiently.

November 27, 2024