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stock split, stock research
Begin Part 2 of 3
THE PLAYS: Got a stock split from RNR! Also solid moves from PNRA (another new high), MGA, APPB, SRCL, and RUS!
BONUS PLAYS: CTX started up but on low volume, and LIN is still set up with another doji.
MXIM (Maxim--$47.48; -2.25; optionable): Semiconductor
http://biz.yahoo.com/p/m/mxim.html
STATUS: MXIM fell from its six-week lateral range, taking out its 200 day MVA (50.11) recently. It has tried to hold, moving laterally while testing back over the 200 day. Today it reached up to 51.04, but fell back as volume was very strong (9.12m; avg. 5.7m). It closed back near the recent lows, and we will look for a continued drop to trigger a put play. There is a February low at 45.67, but we are targeting 40 on this move.
BUY POINT: Below 46 on continued strong volume. Stop: 52
POSITION: June $55 puts to buy (XIQ RK).
ABY (Abitibi-Consolidated--$9.27; +0.12; optionable): Paper
http://biz.yahoo.com/p/a/aby.html
STATUS: Recently completed a year-long cup pattern, but off of the highs pulled back to test the 50 day MVA. ABY has bounced nicely from that level twice, forming an ascending wedge. This week the stock has made a gradual move up, but today got a big infusion of volume (814k; avg. 218k), taking it near the pattern highs. Looking for a continued move and breakout. Good money flow and buying, and relative strength has broken out. Target: 11.25.
BUY POINT: 9.55 on continued strong volume (min. 300k). Stop: 9
POSITION: Stock and/or July $7.50 calls to buy (ABY GU).
NTBK (Net.Bank--$17.04; +1.25; no options): Savings & Loan
http://biz.yahoo.com/p/n/ntbk.html
STATUS: NTBK has made a solid move off of 2001 lows at 7, pulling into a lateral range since early March that has moved between 15 and 17. NTBK tested 15 again last week (just below the 50 day MVA, at 15.54), but made its way back up, and today blasted up on earnings news. Volume was huge at 2.72m (avg. 739k), and NTBK is back near the range high. Looking for a breakout, and targeting 21. Excellent money flow and buying.
BUY POINT: 17.73 on continued strong volume (min. 1m). Stop: 16.50 (7%).
POSITION: Stock and/or July $15 calls to buy (NAA GC).
Quick updates prior bonus plays:
UAG - Has just blasted up! Could be ready for profit-taking now
AVY - Broke out!
XTO - Moving on big volume, but not breaking away on a big move yet
TBCC - Nice 50 day MVA bounce
MTB - Continues the solid move
ARW - Dropped back again from resistance
EMR - Bounced, but looks like it will fall back again
CBIZ - Big recovery today and could try a move
TDY - Nice breakout!
FCTR - Started the move
MFC - Blasting up!
IMDC - Pulled back a bit from the move but holding support at the 10 day
BRCD - Moving back down after a test of the 50 day
CCL - Testing the breakout
IRIC - Ditto
LEXR - Holding up on the test
RGBK - Broke out again, but the big volume is not pushing it far
CMX - Fell back hard, protecting positions
RTEC - Tested the 10 day but dropped back on the put play
DRTE - Trying a move but on weak volume, just under breakout level
MCY - Holding up after the breakout
HLT - Testing the breakout on low volume
PZB - Holding support after the gap up and reversal
ASCA - Back to the 50 day on stronger volume, not looking too good
SMTC - High volume doji at resistance could signal a resumption of the fall
CAT - Still looking for a renewed drop from this test of the 50 day
JILL - A bit erratic; it could move up again, but protecting from a downward move through the 50 day
CF - Nice consolidation over the 10 day, something of an ascending wedge
CDIS - Setting up an ascending wedge
FDS - Still dropping on the put play
TIN - Loose doji under the 10 day MVA signals a possible drop again
PRE-ANNOUNCEMENT PLAYS FOR THIS WEEK: No announcement from MTG today.
PRE-ANNOUNCEMENT BEST PLAYS:
1) RNR - Stock split announcement!
2) EASI - Trying to breakout
3) MGA - Big move!
4) ATK - Could get a little test
5) MHK - Still a good pattern
6) BER - Testing back
RNR (Renaissancere Holdings--$115.40; -0.40; optionable): P & C insurance. Announced the split today! Splits 3:1 effective May 31.
http://biz.yahoo.com/p/r/rnr.html
STATUS: RNR has been solid, giving us some nice plays going toward the split announcement. It most recently broke from a small cup in April, tested the move, and hit 122.50 before dropping back. It is holding the short-term MVA's at this point (10 & 18 day at 114.50 and 112.92), dropping back to support on light volume the last two sessions after a promising bounce. With the announcement we could get another bounce here, and we will look at another play with options up to a target of 126. Will protect profits carefully on the move, as RNR has been a bit volatile.
BUY POINT: Over 117.50 on above average volume (229k; today 165k). Stop: 113.
POSITION: July $110 calls to buy (RNR GB - 30 open interest).
EASI (Engineered Support--$51.00; +1.02; optionable): Aerospace/Defense. Forecast to announce a split the week of 5-27-02 with earnings. At this time, the company cannot confirm this date.
http://biz.yahoo.com/p/e/easi.html
BACKGROUND: EASI last announced a 5:4 split on 2-1-2001 with a board meeting at a price of $28.50. Before that it announced on 6-12-98 at a price of $26.50. The company has sufficient shares for a 3:2 split.
STATUS: EASI is in a cup with handle, with the left side high at 58 from October 2001. It has been in a nice, low volume handle for the last two weeks, this week moving back up from the 47 range (18 day MVA at 48.82 and 50 day at 45.74). Today it got some volume behind it as it reached up out of the handle to a high of 52.13. Looking pretty good, but we need more volume behind a move to produce a solid breakout. With some strength on a move, targeting 62.
BUY POINT: 52.23 on volume of 290k (avg. 192k; today 227k). Stop: 48.57 (7%).
POSITION: Stock and/or August $50 calls to buy (UFE HJ).
MGA (Magna--$77.38; +2.48; optionable): Auto Parts. Forecast to announce a split 5-9-02 with earnings.
http://biz.yahoo.com/p/m/mga.html
STATUS: Looked interesting after a high volume move Wednesday, and today hit our buy point with a solid run on continued strong volume (552,700; avg. 267k). MGA tapped a new high at 78.09, and this has been a solid run following the recent test of its 50 day MVA (72.33). MGA failed on a recent attempt to break from a lateral consolidation, which formed after a nice breakout from a double bottom. After this nice bounce we could see a bit of a rest, but will look for MGA to hold the 77 range for a strong move. On a continued strong move, targeting 90.
BUY POINT: Riding current positions. From here or after a low volume rest that holds the 77 range, over 78.09 on continued strong volume. Stop: 74.
POSITION: Stock and/or August $75 calls to buy (MGA HO - 75 OI).
ATK (Alliant Techsystems--$111.56; -0.89; optionable): Aerospace/Defense. Forecast to announce a split on 5-9-02 before the open with earnings.
http://biz.yahoo.com/p/a/atk.html
BACKGROUND: Last announced a 3:2 split on 8-8-01 at a stock price of $98.20. The announcement was made a day after the annual shareholder meeting and in conjunction with earnings. The annual shareholder meeting was on 8-7-01 at which time additional shares were authorized. The company has sufficient shares for a 3:2 split.
STATUS: Great breakout this week! The move actually started after a test of the 50 day MVA at 100, making a nice bounce then resting in the range of its April consolidation. ATK is now at a new high, and today pulled back slightly to show a loose doji on much lighter volume (247,400; avg. 311k). Looking for a hold of 110 on this low-volume move back, and on a strong move up, still a buy up to 114. Target 125.
BUY POINT: Riding current positions, and we can look at new positions on a hold of 110 and a strong move back up.
POSITION: August $105 calls to buy (ATK HA).
MHK (Mohawk Industries--$65.76; +0.56; optionable): Textile manufacturing. Forecast to announce a split at its May 16 shareholder meeting. Earnings were April 15.
http://biz.yahoo.com/p/m/mhk.html
BACKGROUND: Based upon our research it does not appear that MHK has ever split its stock. The company has sufficient shares for a 2 for 1 split.
STATUS: Cup with handle. MHK has made a nice run, breaking from a reverse head & shoulders in November and trending nicely up its short-term MVA's, with the occasional test back to the 50 day. MHK hit a high of 68.10 in early March, and off of that has formed the current pattern. MHK is moving up in the handle a bit, but volume is very low (276k; avg. 641k). We will be patient and wait for the breakout. Good relative strength and buying. Target: 79.
BUY POINT: 67.05 on volume of 965k. 62.36 (7%).
POSITION: Stock and/or August $60 calls to buy (MHK HL - 89 open interest).
BER (W.R. Berkley--$60.21; -0.56; optionable): Property & Casualty Insurance. Forecast to announce a split at the annual shareholder meeting on 5-14-02 at 2:30 ET.
http://biz.yahoo.com/p/b/ber.html
BACKGROUND: Based upon our research it does not appear that BER has ever split its stock. The annual shareholder meeting was on 5-15-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: With earnings Monday BER gapped up from a test of its 50 day MVA (57.26), and has held up on the move. We were looking for a pullback off of Wednesday's high-volume doji, and today BER pulled back a bit, holding its former highs as volume pulled back a bit (252,400; avg. 117k). Not ready for new positions yet, but we are holding existing positions through a test that holds 60, and looking for a strong move back up from that point, likely next week. Targeting 68 with current positions, and we can look at options positions from here.
BUY POINT: On a hold of 60, a move back over 61 on continued strong volume. Stop: 57.
POSITION: July $55 calls to buy (BER GK).
PRE-SPLITS BEST PLAYS: Remember, we try to grab Pre-Splits as they break out of good patterns or as they start a run right before the split. Not looking for home runs, but looking for those $3 to $4 moves running into the split, watching for topping signs and potential resistance. Not huge money, but it can be very steady. We set our initial stops at the 7-8% range below the purchase price (or just below obvious support), and move them up on a move to preserve our profits.
1) FAST - Ready to move
2) ABM - Trying to breakout
3) STZ - Breakout and being added to the S&P 500
FAST (Fastenal--$83.88; +1.42; optionable): Home improvement stores. Splits 2:1 effective 5-13-02.
http://biz.yahoo.com/p/f/fast.html
STATUS: Looking good. FAST has made a great move, bounced from the 50 day MVA (then 72.50, now 77.50) in early April, and making another move after forming a lateral consolidation that tested its 18 day MVA (currently 81.80). It made a new high at 86.48 recently, pulling back over the past week to test the former consolidation highs and the 18 day. Today FAST started back up a bit, and volume spiked up again to huge levels, at 583,800 (avg. 230k). Looking for a continued bounce. Targeting 95.
PLAY: Over 85, with August $80 calls to buy (FQA HP).
ABM (Abm Industries--$38.25; -0.12; no options): Business services. Splits 2:1 effective 5-7-02.
http://biz.yahoo.com/p/a/abm.html
STATUS: ABM is in a handle consolidation, having moved up to the left-side highs in its cup pattern (dating back to July 2001). The handle is something of an ascending wedge, holding support at its 18 day MVA (37.69). Today it tried to break out, hitting up to 39.23 but pulling back to close with a doji. Volume was up at 88,300 (avg. 75k), and we are still looking for a breakout. If we get a strong breakout we are looking at riding the positions through the split. Targeting 46 on a strong breakout.
PLAY: 39.33 on volume of 100k or better, with stock.
STZ (Constellation Brands--$61.24; -0.51; optionable): Wineries. Splits 2:1 effective 5-14-02.
http://biz.yahoo.com/p/s/stz.html
STATUS: Nice breakout this week, as ABM ran from a lateral consolidation of dojis that again tested its 18 day MVA (57.77). STZ has been running steadily up along its short-term MVA's since breaking from a double bottom and to a new high in January, and now it will be added to the S&P 500. Off of today's loose doji, we will see if STZ comes back a bit to test the 60 level, and on a move back up from there we can look at new positions and target 66.
PLAY: After a test that holds 60, a move back over 61.50, with June $60 calls to buy (STZ FL).
CONTINUING CANDIDATES BEST PLAYS: INVN still set up for a possible put.
1) FITB - Setting up an ascending wedge
FITB (Fifth Third Bancorp--$68.97; +0.37; optionable): Regional bank.
http://biz.yahoo.com/p/f/fitb.html
BACKGROUND: Last announced a 3:2 split on 6-20-00 at a stock price of $61. The annual shareholder meeting was on 3-19-02 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: Slowing a bit on this bounce just short of its high (69.70), today moving up slightly but showing a loose doji on lighter volume (1.5 million; avg. 1.74m). FITB has shown solid support at its 50 day MVA its last two moves down, and this time we look for the stock to hold the short-term MVA's at 68, setting up the breakout. Target: 80.
BUY POINT: 69.80 on volume of 2.3m. Stop: 66.50.
POSITION: August $65 calls to buy (FTQ HM).
POST-SPLITS BEST PLAYS:
1) CHBS - Looking to break from the consolidation
2) CHS - Making a move
3) PFCB - Post-split strength
CHBS (Christopher & Banks--$38.51; +1.27; optionable): Apparel stores.
http://biz.yahoo.com/p/c/chbs.html
STATUS: CHBS made a very sharp breakout in early April from a cup pattern, and has held up well, consolidating and pulling back toward its 18 day MVA (36.99) on light volume. Today it bounced from the 18 day, although volume was well below average at 271k (average 475k). Looking for an infusion of volume to push a breakout. Target: 46.
PLAY: 39.35 on volume of 640k, with stock and/or September $35 calls to buy (URH IG).
CHS (Chico's Fas--$37.66; +1.06; optionable): Apparel stores.
http://biz.yahoo.com/p/c/chs.html
STATUS: Formed something of a reverse head and shoulders out of what was a little double bottom pattern (the latter being the head of the rev. h & s). The right shoulder kept extending in a handle-type consolidation, but moved up the last three sessions with increasing volume. Today CHS made a solid move, making a new closing high as volume was up to 689k (avg. 586k). A good move, and still a buy up to 39. Targeting 44.
PLAY: Still a buy up to 39 on increased volume, with August $35 calls to buy (CHS HG).
PFCB (PF Chang's--$38.03; +1.59; optionable): Restaurants. Split 2:1 effective 5-2-02.
http://biz.yahoo.com/p/p/pfcb.html
STATUS: One that we were looking at to show post-split strength, and today PFCB hit the buy point as it broke to a new high, out of its lateral consolidation. Volume was again excellent on the move, coming in at 1.16m (avg. 366k). A strong stock and we are adjusting the target to 44.
PLAY: Still a buy up to 39 on continued strong volume, with July $35 calls to buy (HUO GG - only 5 OI as yet).
End Part 2 of 3
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stock split
stock research
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