Equinix (EQIX) Earnings Play 2/10/10

Equinix, Inc. provides network-neutral colocation, interconnection and managed information technology (IT) infrastructure services to enterprises, content providers and financial companies. Through its International Business Exchange (IBX) data centers, across 18 markets in North America, Europe and Asia-Pacific, customers directly interconnect with a network ecosystem of partners and customers. Its services comprises colocation, interconnection and managed IT infrastructure services.


EQIX shares are down almost 20% from 52-week high and are currently trading at $93, same point where they traded last time when the company reported a blow out quarter and beat EPS estimate by a large ($0.47 actual vs. only $0.30 consensus).  The company has beat EPS on average by 33% each of last 5 quarters.  


15 analysts have "Strong Buy" or "Buy" rating on the stock.  Morgan Joseph has $125 price target.  I am leaning slightly bullish-to-neutral going into earnings which come out after hours today.  


I like the following calendar spread;


- Buy to open March $95 calls
- Sell to open Feb $95 calls


Just filled the order for a net debit of $1.50.  The implied volatility is elevated to $40 in Feb vs. 32 in March.  The break even on this spread is $90 on the downside and $100 on the upside.  


Good luck!