Options Corner: DELL Rallies Nearly 300% Y/Y, Will Earnings Continue Run?

Finance / Market Instruments Mentioned

• Dell Technologies (DELL)

Key Market / Company Context

• AI-driven resurgence: Analysts and the moderator attribute much of Dell’s rally to AI spend and Dell’s AI revenue growth.
• 3-year performance (weekly chart):
  • Was below $70/share about 3 years ago
  • Cited total gains of over +550%
  • Traded in a wide range around ~$70 to ~$140 for much of the period, until recent earnings
• All-time highs / pullback:
  • Reached all-time highs above ~$514 a couple weeks prior
  • Then experienced a pullback
• AI revenue growth rate (earnings-related):
  • On the quarter highlighted when the stock jumped +33% on earnings:
    • AI component up >+750% year-over-year (as stated)
• 1-year performance (2026):
  • Up ~+260%+ so far in 2026
  • Most gains came over the last couple of quarters
• Technical levels / moving averages:
  • 50-day simple moving average (support): around ~$434
  • 200-day simple moving average: around ~$246
  • The 200-day level is cited as ~45% below the current share price (suggesting price is far above the longer-term trend)
• Valuation / momentum caution: The situation is described as “lofty” on a valuation basis, with expectations high

Options / Risk Management Framework (Example Trade)

1) Context the options-implied risk

• Options priced a one-day move of about ±9%

2) Monitor technical momentum

• RSI ~55
  • Mid-range (not overbought >70 and not oversold <30)

3) Choose a neutral-to-bullish posture using implied volatility (IV)

• Target behavior:
  • Profit from high implied volatility (IV) prior to earnings
  • Benefit from IV “vol crush” after earnings

4) Use a short-dated weekly expiration

• Options expire September 4 (stated as ~3 days away at the time of the idea)

5) Trade structure: out-of-the-money call vertical (defined risk)

• Sell: 490 call
• Buy: 500 call
• Spread width: $10 (defined maximum loss)

6) Expected credit / economics (as stated)

• If the stock opens around $453:
  • Collect ~$240 credit per spread
• Max profit: ~$240 per spread
• Max risk: about ~$760

7) Probability-based rationale

• The sold 490 call is described as having about ~73% probability of being out of the money at expiration (per stated probabilities)

8) Breakeven

• ~$492.40 to the upside
• Cushion described as about 8.5%–9% up from the scenario/strike context (aligned with a “one standard deviation” framing)

9) Trade outcomes described

• Profit scenarios:
  • Stock stays below $490 at expiration (keep the $240)
  • Stock consolidates after earnings
  • Even if shares rise to around $480, IV contraction could help; the position may be buyable back cheaper after earnings due to IV crush
• Built-in caution:
  • Limited profit and defined loss if price rises beyond the upper breakeven

Key Numbers / Figures Summarized

Price / Levels (DELL)

• ~$70 (3 years ago)
• Range: ~$70–$140 (for a long stretch)
• All-time high: >$514
• 50-day SMA: ~$434
• 200-day SMA: ~$246

Performance

• >+550% over ~3 years (as stated)
• ~+260%+ in 2026 (as stated)
• Earnings move: +33% associated with AI results (as stated)

Fundamental Growth

• AI revenue growth: >+750% YoY (as stated)

Options / Volatility

• Implied move: ±9% (one-day)
• Example credit: $240 for the 490/500 call vertical
• Defined risk: ~$760
• Break-even: ~$492.40
• Probability of OTM for the short call: ~73%
• Expiration referenced: September 4 (~3 days away)

RSI

• ~55 (consolidation / mid-range)

Disclosures / Disclaimers

• None explicitly stated in the provided subtitles (no “not financial advice” language included).

Presenters / Sources (As Mentioned)

• Tom White (options/chart analysis)
• Main host (unnamed) referenced “Joining us… Tom White” and “book-ending our show” (no additional name provided in the subtitles)