GNSS Forecast


Bullish Case: The recent defense orders and successful product integrations, particularly with German Navy projects, suggest potential revenue growth and market expansion for Genasys. Strong financial backlogs and technological advancements like LRAD systems and Protect App will bolster long-term revenue.


Bearish Case: Analyst downgrades and continued revenue decline present significant downside risks. Elevated implied volatility in options and mean-reverting stock behavior historically suggest limited upside movements.


Potential Outcomes:

1. Strategic Partnerships Lead Revenue Surge (20%) - New defense contracts and tech integrations;

2. Continued Revenue Decline (35%) - Analysts' negative outlook materializes;

3. Mean-Reversion to $1.50-$2.20 Range (45%) - Historical mean-reversion trend prevails.


Trading Oracle: Sell September 2024 $3.00 Calls and buy September 2024 $4.00 Calls for a Helium Short Volatility strategy. Given elevated implied volatility, historical mean-reversion, and analyst downgrades, this credit spread leverages high implied volatility and has a strong probability of profit within a 2-month time horizon.


July 23, 2024


Genasys Forecast

GNSS      Genasys











Correlated Assets

Assets that tend to move strongly with GNSS



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.56)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.19)


VFC Forecast + Options Trading Strategies   VFC  VF (0.14)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.06)



Uncorrelated Assets

Assets with little price relationship to GNSS



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.06)


VFC Forecast + Options Trading Strategies   VFC  VF (0.14)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.19)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.56)



Anticorrelated Assets

Assets that tend to move strongly against GNSS



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.56)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.19)


VFC Forecast + Options Trading Strategies   VFC  VF (0.14)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.06)





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