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stock watch, stock split
Begin Part 3 of 4
CONTINUING CANDIDATE BEST PLAYS:
1) RJR - Finally got the breakout!
2) MERQ - Held support
3) ACF - Trying to break out again
RJR (RJ Reynolds--$61.73; +1.99; optionable): Tobacco.
http://biz.yahoo.com/p/r/rjr.html
BACKGROUND: Based upon our research it does not appear that RJR has ever split its stock. The annual shareholder meeting is scheduled for 4-25-01 at 9:00 ET at which time no additional shares will be authorized. The company has sufficient shares for a 2:1 split.
STATUS: Has formed a little saucer and is in a handle that is looking like a small ascending wedge. Broke out of its little saucer with handle, blasting over the handle high of 60.75 on big volume (672,000; average 425,000). Looking for more, and still a buy up to 63.79. Target on the breakout is $68-70.
BUY POINT: A continued move on solid volume.
POSITION: Stock and/or August $55 calls to buy (RJR HK).
MERQ (Mercury Interactive--$67.51; +0.10; optionable):
http://biz.yahoo.com/p/m/merq.html
STATUS: Has found support at its 10 day MVA (64.58) after pulling back from the high on this week's run (73.25). Friday the stock hit just under the 10 day but rebounded to close, moving on increased volume (5.48 million; average 5.2 million). The stock is building the right side of a cup base, showing strength by holding its 10 day on a climb that has taken it back through its down trendline and 50 day MVA (57.89). From this support we can continue to watch for MERQ to make a move back up toward its recent high and beyond in a rally.
BUY POINT: A move back up on increased volume in a good tech market.
POSITION: Stock and/or July $65 calls buy (RQB GM).
ACF (Americredit--$47.20; +1.35; optionable): Credit Services.
http://biz.yahoo.com/p/a/acf.html
BACKGROUND: Last announced a 2 for 1 split on 8-18-98 at a stock price of $35. The annual shareholder meeting was on 11-7-00 at which time no authorized shares were increased. The company does not have sufficient shares for a 2 for 1 split, but does have sufficient shares for a 3 for 2 split.
STATUS: Has been very strong, making a solid run over its February highs at 37.50. The stock has pulled laterally since its last breakout over the 45 level, but pushed back up with a strong move Friday, making a new closing high after testing 45 at its low Friday (10 day MVA is at 44.83). The stock is showing healthy signs on this great move, making strong moves up and then pulling back to the 10 day with lighter volume. Friday's move kept up that solid price/volume action (up to 1.34 million; average 880,000), and we will look for a continued move on strong volume. The intraday high from Monday is just ahead at 48.23.
BUY POINT: A move up on continued strong volume. This has been quite a run, and even with the strength we are protecting profits with stops, keeping them just under the 45 level.
POSITION: Stock and/or August $45 calls to buy (ACF HI).
POST SPLITS BEST PLAYS:
1) PFGC - Testing breakout
PFGC (Performance Food--$28.00; -0.05; optionable): Food wholesale. Split 2:1 on 5-1.
http://biz.yahoo.com/p/p/pfgc.html
STATUS: Made a strong move with its split, breaking out but now is testing the break. The stock is acting well, Friday pulling back for a doji on the former breakout point, moving on lower volume (189,100; average 141,500). Looking for the stock to hold here and make a move back on its breakout high of 28.94.
BUY POINT: After holding 28, a strong move up on increased volume.
POSITION: Stock and/or June $25 calls to buy (PGU FE low open interest).
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PRE-ANNOUNCEMENTS REMAINING PLAYS
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CECO (Career Education--$50.91; +0.09; no options): Forecast to announce a split on 5-11-01 in conjunction with its annual shareholder meeting.
http://biz.yahoo.com/p/c/ceco.html
BACKGROUND: Last announced a 2 for 1 split on 8-1-00 in conjunction with earnings. The stock price was $57. The annual shareholder meeting is scheduled for 5-11-01 at 1:00 pm CDT at which time additional shares will be authorized. The company has sufficient shares for a 2 for 1 split without increasing authorized shares.
STATUS: Going into its forecast CECO is trying to hold support over it's highs in its recent saucer and ascending wedge patterns. It has pulled back from the breakout high of 55, catching support at those former highs (and 18 day MVA) Friday and pushing back up slightly. Volume was sharply up at 364,500 (average 268,000), so perhaps the stock is readying for a strong move back up.
BUY POINT: Aggressive Over 53 on continued strong volume. Breakout Over 55 on above average volume.
POSITION: Stock only.
SDS (Sungard Data--$58.90; +1.95; optionable): Forecast to announce a spit on 5-11-01 in conjunction with its annual shareholder meeting.
http://biz.yahoo.com/p/s/sds.html
BACKGROUND: Last announced a 2 for 1split on 8-15-97 at a stock price of $50. The annual shareholder meeting is scheduled for 5-11-01 at 9:00 ET at which time additional shares will be authorized.
STATUS: Enjoy it while you can if you own it. SDS has made a protracted move up the last couple of months, looking more precarious in recent sessions as it gains ground on volume that continues to be below average (753,100 Friday; average 977,200). It defied the odds Friday with its move, continuing up toward the high in the left side of its two-month cup pattern. Going into the forecast next week we will look for the stock to gently pull back and catch support, perhaps at the 10 day MVA (55.08), and we can look at it from there.
BUY POINT: A move back up on strong volume after a pullback on low volume that holds the 55 range.
POSITION: Stock and/or July $50 calls to buy (SDS GJ).
CEC (CEC Entertainment--$48.50; -0.50; optionable): Forecast to announce a split on 5-22-01 in conjunction with earnings.
http://biz.yahoo.com/p/c/cec.html
BACKGROUND: Last announced a 3 for 2 split on 6-24-99 at a stock price of $40.
STATUS: Is bleeding back after having broken out with a big gap in April and then hitting a high of 53.70. The stock gave up the 10 day MVA (49.68) Thursday and then the 18 day (48.65) Friday, gapping down below its gap-up level but pulling back up to close. No real pattern here now, as the stock tries to hold on after having peaked. There is still time before the forecast, and the stock is still well within range, so we will watch for it to try and hold support and then build pressure for a move up.
BUY POINT: Holding support at 48, and then a move back over 51 on continued strong volume (430,700; average 207,700).
POSITION: Earnings play. Stock and/or June and September $45 calls to buy (CEC FI and CEC II low open interest for both options, however).
CORS (Corus Bankshares--$51.25; -0.82; no options): We are working on a new date.
http://biz.yahoo.com/p/c/cors.html
BACKGROUND: Last announced a split in 1995 at stock price of $44. The annual shareholder meeting was on 4-26-00 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split.
STATUS: Banking. Looked like it was building pressure for a move, but the stock pulled back Friday instead of springing forward. However, the stock is still holding in the range of its former pennant pattern (after having dropped out of it at the end of April but then recovering), and is holding the 18 day MVA (51.10) after a move that was on continued weak volume (up to 8100; average 23,700). Still looking for a break over the recent highs.
BUY POINT: Over 52.50 on above average volume. Breakout of the pattern: 53.88.
POSITION: Stock.
FNM (Fannie Mae--$79.00; +0.30; optionable): Mortgage Investment. It is very difficult to get an earnings date out of FNM, but we are continuing to work on it.
http://biz.yahoo.com/p/f/fnm.html
BACKGROUND: Has split its stock on two prior occasions, announcing a 4:1 split on 2-27-95 at a price of $120, and a 3:1 split on 9-22-89 at a price of 120. It likes a post-split price in the $40 range.
STATUS: Is holding at its 50 day MVA (78.54), showing its second consecutive doji on that level Friday. We will see if the stock can hold here rather than again moving down to its up trendline, currently at 75. We have been looking for a strong move that would take the stock over consolidation levels at 82; Friday the stock retreated after hitting up to 80.10.
BUY POINT: Aggressive A move back over 80 on above average volume (4 million; Friday 2.58 million). Safer Over 82 on above average volume.
POSITION: Aggressive Stock and/or June $75 calls to buy (FNM FP). Safer Stock and/or June $80 calls to buy (FNM FO).
PRE-SPLITS REMAINING PLAYS: With these stocks we keep an eye out, waiting for the start of a pre-split run.
STZ (Constellation Brands--$68.01; +0.71; optionable): Wineries. Announced a 2:1 stock split as forecast, effective May 14.
http://biz.yahoo.com/p/s/stz.html
STATUS: Struggling to fight back after dropping from its breakout high of 73.98 (from a saucer in March), and this week the stock has managed to move back over a confluence of trendlines (50 day and 18 day MVA's at 66.61 and 66.91). Volume was not great on the move, and it still faces February-April levels in the 68-70 range that provide resistance. Trying, but having a tough time of it, and could get to more open field with a jaunt over 70.
PLAY: Aggressive A move over 69, with stock and/or June $65 calls (STZ FM low open interest) to buy. On a move we would be carefully protecting positions.
SOTR (Southtrust Corp--$46.31; -0.05; optionable): Banking. Splits 2:1 effective 5-14-01.
http://biz.yahoo.com/p/s/sotr.html
STATUS: Trying to hold on to support at its recent consolidation highs after pulling back from a breakout high that hit 49.20. The stock is just under its 10 day MVA (46.51), showing a tight doji Friday. If it can hold we will look for a strong move back up.
PLAY: After holding support here, a strong move up, with stock and/or June $40 calls to buy (SHQ FH).
CHS (Chico's Fashion--$42.64; -1.20; optionable): Declared a 3:2 stock split, effective May 16.
http://biz.yahoo.com/p/c/chcs.html
STATUS: Has pulled back from its breakout from a cup with handle, failing to hold Thursday's loose doji over the 10 day MVA (43.09), giving up that support Friday for the first time in a month. Volume has not been particularly strong on the retreat, however, coming in at 313,800 Friday (average 537,200). Moreover, the stock is still holding the 18 day MVA (41.77), which is consistent with the high in the left side of the former cup pattern. Looking for a hold here and then move back up going into the split.
BUY POINT: Aggressive A move back over 45. Breakout A move to a new high over 47.
POSITION: Aggressive Stock and/or June or August $40 calls to buy (CHS FH or CHS HH very low open interest for the June options). Breakout Stock and/or June or August $45 calls to buy (CHS FI or CHS HI very low open interest for the June options).
BAX (Baxter International--$94.71; +1.05; optionable): Health Services. Splits 2:1 effective 5-31-01.
http://biz.yahoo.com/p/b/bax.html
STATUS: Broke of its pennant that started forming in early March, gapping over the upper down trendline (93) Thursday. However, after hitting a new high intraday at 95.70, the stock retreated to close. Closing that far off of the intraday high could indicate selling back, and volume dippe to 1.56 million (still above the average of 1.48 million). On a pullback we will see if the stock can hold the trendline.
PLAY: After holding the trendline with a low volume pullback, a move back up on continued strong volume, with stock and/or July $90 calls to buy (BAX FR).
BJS (BJ Services--$76.06; +0.66; optionable): Splits 2:1 effective on or about May 31.
http://biz.yahoo.com/p/b/bjs.html
STATUS: Oil and Gas Equipment. Has slammed back down to its 50 day MVA (75.32) with two days of heavy selling, showing dojis over that support the last two sessions. The stock had been in a cup, and after that big fall we will just see if it can hold the 50 day and manage some sort of move before the split, which is still a way out. Not a good play right now.
PLAY: Aggressive A move back over 78.50 on above average volume (1.57 million; 1 million Friday), with stock and/or July $75 calls to buy (BJS GO).
UHS (Universal Health--$82.30; -3.34; optionable): Announced a 2:1 stock split, effective June 1.
http://biz.yahoo.com/p/u/uhs.html
STATUS: Did not give us the bounce off of the 200 day MVA (84.13) as it had done four times this year, instead selling back through that level on big volume (637,000; average 331,000). We will see if it can recover (has some lows at 80 as support) or if on a test of the 200 day it drops back again. There are better ones to focus on right now, and there is ample time before the split.
FIC (Fair Isaac--$73.95; +0.05; no options): Announced a 3:2 stock split Wednesday, effective June 4!
http://biz.yahoo.com/p/f/fic.html
BACKGROUND: On 6-25-95, FIC issued a 100% stock dividend equivalent to a 2 for 1 split. The price at the time of the dividend was $56. The annual shareholder meeting was held 2-6-01 at 9:30 PST. Authorized shares were not increased, but the company has sufficient shares for a 2 for 1 split.
STATUS: Business services. Has made a great breakout run, and continued up after announcing its split, but clearly has to be topping. The stock finally showed a doji Friday, and we will look for FIC to make an orderly retreat, watching for it to hold the 70 range (10 day MVA is 68.81).
BUY POINT: It might need to consolidate a bit on a retreat. After that, we will look at a strong move up.
POSITION: Stock only.
LH (Lab Corp of America--$139.40; -1.20; optionable): Splits 2:1 effective 6-12.
http://biz.yahoo.com/p/l/lh.html
STATUS: After gapping over 140 to break over a down trendline that began in late December, LH is testing that move. Friday it continued it gradual descent, closing under its down trendline (connecting December and February highs, at 139-140). Volume picked up to 375,900 (average 369,200) as the stock showed a doji. Still looks nice in its descending handle to a cup pattern, with the handle high way up at 151.12.
PLAY: Aggressive A move over 145 on increased volume, with stock and/or June or August $140 calls to buy (LH FH no open interest, or LH HH).
CONTINUING CANDIDATES REMAINING PLAYS: When splits are not announced, we will keep the best split prospects on the report rather than continue to carry all of them in case there is a an unexpected announcement. We will continue to monitor the stocks that are trimmed and add them again when we ascertain a revised split announcement date.
APPB (Applebee's--$43.50; +1.14; optionable): Did not get the announcement.
http://biz.yahoo.com/a/appb.html
BACKGROUND: Based upon our research it does not appear that APPB has ever split its stock. The annual shareholder meeting is scheduled for 5-10-01 at 10:00 am CDT at which time no additional shares will be authorized. The company has sufficient shares for a 2:1 split.
STATUS: Is simply in a strong uptrend along its short-term MVA's (10 and 18 day at 41.96 and 40.86, respectively). The stock tapped back to the 18 day Thursday and bounced back up strong, but Friday's move to a new high was on much lower, below average volume (275,800; average 421,300) that makes a further move suspect. Even so, we would not typically jump in on a trend like this at this juncture, so we will see if the stock can consolidate some of its gains.
BUY POINT: A move up after holding a consolidation in the range of its 10 day MVA. Could take a bit of time.
POSITION: Stock and/or August $35 calls to buy (AQB HG).
ASFC (Astoria Financial--$58.25; +0.55; optionable): Savings and Loan.
http://biz.yahoo.com/p/a/asfc.html
BACKGROUND: Last split its stock in 1996 with the split at a price of $56. The annual shareholder meeting was on 5-17-00 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split. The next annual shareholder meeting is scheduled for 5-16-01 at 9:30 ET.
STATUS: The stock is trying, but just cannot muster any volume to help push a move. It recently broke out of a nice saucer, and tested back to its 10 day MVA (57.13), all things that strong stocks do. Friday it again tested the 10 day at its low but on a move up volume was very weak at 191,400 (average 422,500). Intraday the stock hit the breakout high of 58.31. Looking for a strong push.
BUY POINT: Up from here, but only with increased volume above the average.
POSITION: Stock and/or July $55 calls to buy (AQR GK).
End Part 3 of 4
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stock watch
stock split
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