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Begin part 3 of 3
THE PLAYS
Good movers Friday: ATVI; CME; CREE; MGG; MSCC; MTSN
New Leader Plays:
Play Date: 12/04/2004
ACS (Affiliated Computer--$59.11; -0.66; optionable): ITS software
http://biz.yahoo.com/p/a/acs.html
STATUS: Cup w/handle. ACS has formed the current 9 week base on the heels of a 9 month cup with handle; nice base on base pattern, and these work to really weed out the sellers as they get frustrated and sell out during the second pattern or weeding process. Solid 3 to 1 accumulation in the current base (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows net buyers during the pattern. The handle is a nice three week, very flat lateral range holding just above the 18 day EMA (58.89) on very low, below average volume. Sixty has held as firm resistance during the handle, and we are looking for a strong volume break through that level to start the position. This could give us a split announcement in January as it is at its first ever split price.
Volume: 940.8K Avg Volume: 1.203M
BUY POINT: $60.22 Volume=1.8M Target=$67.72 Stop=$58.68
POSITION: ACS DL - Apr. $60c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/acs.html
Continuing Leader Plays:
Play Date: 11/18/2004
EMR (Emerson Electric--$68.06; +0.5; optionable): Electrical equipment for industrial, consumer, and commercial markets
http://biz.yahoo.com/p/e/emr.html
STATUS: Cup w/handle. Volume was up Friday as EMR tested the top of the 4 week handle to its 11 month base. A very nice, flat handle that dipped the past week, a move we call the shakeout where those fearing another sell off get out of the stock. Once they are gone the stock can move higher as supply and demand takes over. Strong 10 to 6 accumulation in the pattern has set up the foundation for the breakout.
Volume: 1.229M Avg Volume: 1.174M
BUY POINT: $68.78 Volume=1.4M Target=$78 Stop=$66.48
POSITION: EMR CM - Mar. $65c (84 delta) &/or Stock
http://www.investmenthouse.com/cs/emr.html
Play Date: 12/02/2004
PLCE (Childrens Place--$32.45; -0.79; optionable): Children's apparel stores
http://biz.yahoo.com/p/p/plce.html
STATUS: Cup w/handle. Friday PLCE took a day off on low volume after a strong surge off the 18 day EMA (31.67) Thursday. It is still poised to make the breakout from its 8.5 month base sporting strong 12 to 6 accumulation; plenty of buyers setting up the breakout and run. Strong money flow is leading the way, and just want to see that volume back up as it makes the breakout move through the buy point.
Volume: 512.468K Avg Volume: 626.493K
BUY POINT: $33.95 Volume=975K Target=$40 Stop=$32.75
POSITION: TUY CF - Mar. $30c (76 delta) &/or Stock
http://www.investmenthouse.com/cs/plce.html
Play Date: 11/08/2004
SINA (Sina.com--$38.39; -0.46; optionable): Chinese internet
http://biz.yahoo.com/p/s/sina.html
STATUS: Double bottom w/handle. Tried the breakout move Thursday as volume jumped back above average, but could not hold the move. Friday it just took the day off with a low volume nothing day. That still leaves it in a nice handle to its 11 month base. $40 is the key level that has turned it back twice, so we are looking for the stock to move through that level on a strong shot of volume to take new positions.
Volume: 4.249M Avg Volume: 4M
BUY POINT: New positions: $40.12 (orig. $36.75) Volume=7M Target=New positions: $48 (orig. positions: $45.42) Stop=$36.38
POSITION: NOQ CG - Mar. $35c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/sina.html
PRE-ANNOUNCEMENT PLAYS
Current Pre-Announcement Plays: In each report we look at the candidates that are in the best patterns ahead of their potential announcements. This focus on leaders in good patterns allows us to make good money even if companies do not announce the split. The key with splits is the pattern. Still gat positive moves on the announcement, but stocks in this market need to have a good pattern of accumulation to really benefit from a split announcement.
AEOS: Forecast 1-24-04
BMET: Forecast 12-17-04.
BSC: Tentative date: 12-15-04
CDWC: Researching the date.
CHS: Forecast 12-14 or 12-15
CMTL: Forecast 12-7-04 before the open.
CNMD: Researching next potential date. Continues to set up well in its reverse head and shoulders.
COLM: Still researching the date.
DGX: Researching next date, tentatively 1-25-05.
EBAY: Forecast to announce another split in January. Researching the exact date.
EASI: Forecast 12-14-04 before the open.
EXBD: Still researching next date as no split announced this month. Setting up for the next move.
FDX: Forecast 12-6.
GPN: Forecast 12-16-04
HAR: Forecast 1-26-04.
KMRT: Researching date after its announcement of the Sears acquisition
LEH: Forecast 12-21-04
MCO: Forecast 12-7-04
MGG: Forecast 12-7-04
NMGA: Forecast 12-1-04
SBUX: Did not announce with earnings. Researching next date.
SPLS: No split announced with earnings on 11-16-04. Continuing the move up the 10 day EMA.
TTC: Forecast 12-8-04. Looking ofr a continuation of the nice Wednesday move..
UTX: Forecast 1-20-04
XRAY: Forecast 12-14-04.
Full Write-ups: We do not cover all candidates in full in each report, but focus on those ready to make a move or are right at their forecast announcement date. This way we are focused on those stocks ready to make moves.
New Pre-Announcement Plays: Some old favorites have come back into split contention.
Play Date: 12/04/2004
AEOS (American Eagle Outfitters--$43.22; -0.07; optionable): Apparel stores. Forecast to announce a split 1-24-04.
BACKGROUND: Last announced a 3:2 split 1-22-01. Prior to that it announced splits in March 1999, April 1998, and December 1997.
http://biz.yahoo.com/p/a/aeos.html
STATUS: Flat base. AEOS has formed a short 4 week base just over the 18 day EMA (42.49) after breaking out in March and embarking upon a long rally up the 50 day EMA (40.35). It is somewhat extended, but still showing buyers with positive 2 to 0 accumulation in the lateral move along with some good upside volume spikes last week. That indicates it is trying to set up for another break higher as leading retailers continue to enjoy good action. After such a long run the move may not take us into January, but one thing this market has shown is staying power for winners. AEOS showed last week it is still making the right decisions as it posted some impressive sales numbers. Excellent money flow is a good combination with those strong upside volume spikes last week.
Volume: 1.763M Avg Volume: 1.867M
BUY POINT: $44.25 Volume=2.8M Target=$50.65 Stop=$42.32
POSITION: AQU BI - Feb. $45c (45 delta) &/or Stock
http://www.investmenthouse.com/cs/aeos.html
Play Date: 12/04/2004
CHS (Chicos Fas--$43.4; -0.51; optionable): Apparel stores. Forecast to announce a split 12-14-04 or 12-15-04 before or during market hours.
BACKGROUND: Last announced a 2:1 split 6-27-02 at $36. Before that it announced splits 12-19-01 (3:2 at $38); 4-19-01 (3:2 at $42); 12-14-99 (2:1 at $43).
http://biz.yahoo.com/p/c/chs.html
STATUS: Reverse head and shoulders. CHS has been basing since March, and as part of that base has formed the current 22 week reverse head and shoulders pattern. Accumulation is a solid 6 to 4 as it forms back up for the next move, showing net buyers. It got a bit wild to end November ahead of its earnings, but reported very strong resold and bolted higher on strong trade to start the month. It made a modest lateral and slightly lower move Thursday and Friday on very low volume, and we expect it to test the move further for at least a couple more sessions before it is ready to break higher and make the breakout move.
Volume: 904.9K Avg Volume: 1.838M
BUY POINT: $44.11 Volume=2.5M Target=$50.88 Stop=$42.05
POSITION: CHS BI - Feb. $45c (48 delta) &/or Stock
http://www.investmenthouse.com/cs/chs.html
Play Date: 12/04/2004
OPTN (Option Care--$17.71; +0.06; optionable): Home health care. Still researching the date, but tentatively forecast to announce in early February.
BACKGROUND: Last split 5:4 in May 2002 at $20.
http://biz.yahoo.com/p/o/optn.html
STATUS: Double bottom w/handle. Forecast date is a ways off, but a very nice base has formed and we want to take advantage of the opportunity a breakout provides. A nice 20 week pattern has formed, using the 200 day SMA (14.48) on the two lows as support, a good sign that institutions were stepping in to buy at that key level. Strong volume off the second leg in late October, and then a nice, easy and low volume laterally move to consolidate that gain. Volume jumped Friday, and after a lull in the handle that often indicates a breakout ahead. Excellent 4 to 1 accumulation in the base and money flow rallying higher even as the stock price moves laterally. Looks to be hitting on all cylinders and ready to breakout to a new all-time high.
Volume: 399.37K Avg Volume: 223.443K
BUY POINT: $18.05 Volume=320K Target=$21.75 Stop=$17.05
POSITION: UOC DW - Apr. $17.50c (59 delta) &/or Stock
http://www.investmenthouse.com/cs/optn.html
Continuing Pre-Announcement Plays:
Play Date: 11/30/2004
CDWC (CDW Computer Centers--$67.37; -0.63; optionable): Wholesale computer sales.
BACKGROUND: A frequent splitter before the bear market plunge in 2000, CDWC has finally fought back up to the $70 level where it announced regular splits.
http://biz.yahoo.com/p/c/cdwc.html
STATUS: Cup w/handle. Looked ready to make the move after the stolid Wednesday and Thursday action, but faded Friday on very low volume, taking a breather before running higher. We held off given the volume, but a nice pattern, and if volume moves back up this week as it continues higher, it is a buy. A nice 9 month base that has formed an almost textbook handle (lower volume fade). Looks very good, and just waiting for volume to move back in. It has been a long 4 year climb back up, but it never got that low as did many other tech stocks.
Volume: 350.921K Avg Volume: 872.545K
BUY POINT: New: $68.48 (orig. $67.72) Volume=1.3M Target=$75 Stop=$64.65
POSITION: DWQ DM - Apr. $65c (61 delta)
http://www.investmenthouse.com/cs/cdwc.html
Play Date: 11/18/2004
HAR (Harman Intl.--$127.30; +1.30; optionable): High end audio equipment. Forecast to announce a split on 1-26-05 in conjunction with earnings, but after the shareholder meeting it could come at any time now.
BACKGROUND: Last announced a 2 for 1 split on 11-12-03 in conjunction with its annual shareholder meeting at a stock price of $121.12. The annual shareholder meeting was on 11-10-04 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split.
http://biz.yahoo.com/p/h/har.html
STATUS: Flying plateau. We were tempted to move in Friday, but every time we looked at volume it seemed to be going nowhere. We held off, but have a feeling that HAR is going to be right back in the game this week, making the break higher from this nice, flat test of the strong move in late October. Money flow is moving higher ahead of price, and we expect HAR to follow it. This one can run like a deer when it takes off.
Volume: 415.2K Avg Volume: 602.147K
BUY POINT: New: $127.88 (orig. $127.32) Volume=850K Target=$140 Stop=$126.48
POSITION: HAR AE - Jan. $125c (59 delta) or HAR DF - Apr. $130c (51 delta)
http://www.investmenthouse.com/cs/har.html
Post-Split Plays:
Play Date: 11/09/2004
RCI (Renal Care Group--$33.4; -0.24; optionable): Specialized health services
http://biz.yahoo.com/p/r/rci.html
STATUS: Double bottom w/handle. An excellent handle has formed for Renal (the Smuckers of health services), moving laterally on top of the 18 day EMA (33.24) on nice, low below average volume. Just a very nice 29 week base sporting strong 6 to 2 accumulation. Being patient and letting it show us the volume move through the buy point. That is when we will jump on board.
Volume: 124.6K Avg Volume: 318.636K
BUY POINT: $33.11 Volume=370K Target=$39 Stop=$32.97
POSITION: RCI BF - Feb. $30c (84 delta) &/or Stock
http://www.investmenthouse.com/cs/rci.html
Good Investing!
Jon L. Johnson and the Stock Split Report Staff.
All of the foregoing is commentary for informational purposes only. All statements and expressions are the opinion of Online Investment Services, LP or its paid consultants and are not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on our related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolio of Partners of Online Investment Services, LP or its paid consultants may, in some instances, include securities mentioned herein and on our web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors.
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