Price Forecast:

Bullish Case: SAIC’s options market indicates a bullish shift with a high trading volume in calls, supported by stable EPS growth and a low P/E ratio. Historical trends show significant long-term return potential, indicating investor confidence.

Bearish Case: High implied volatility at lower strikes suggests heightened market fear surrounding SAIC's near-term performance. Furthermore, recent insider selling raises concerns that may undermine investor confidence and drive the stock lower.

Potential Outcomes:

• 40% chance of a price recovery to $130 by February 2025, driven by positive earnings reports.
• 30% probability of stagnation around $115 due to ongoing market uncertainties.
• 30% risk of a drop to $100 if bearish sentiment rises further due to insider sales.

Trading Oracle: Given the bullish overall sentiment and skew towards calls, implementing a long debit spread with $120/$125 calls expiring in January 2025 would capture potential upside. Monitor for volatility spikes and consider rolling positions if prices approach $135.

December 13, 2024