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Begin part 3 of 3
THE PLAYS
Good movers Thursday: HSIC; MDR; OMC; PMTI; PTEN; SCHN
NEW PLAYS: New pre-announcement plays are contained in the pre-announcement section.
New Pre-Split Plays:
Play Date: 02/24/2005
BZH (Beazer Homes--$167.83; +6.76; optionable): Residential construction. Splits 3:1 on 3-23-05.
http://biz.yahoo.com/p/b/bzh.html
After Hours: $166.95
STATUS: Flying plateau. BZH was selling on stronger volume on Tuesday and shook us out, but that volume paled compared to the volume Thursday as BZH shot back up. That move put it at the top of its 2 week lateral base that formed following the early February breakout from a 5 week lateral base. When BZH gets moving it can run hard (25 points on the last move). It was giving back some ground late and after hours; looking for it to hold and then continue the move and breakout from this lateral base. We can take aggressive positions after a test back but also on the breakout move.
Volume: 1.148M Avg Volume: 654.909K
BUY POINT: Aggressive: 167.25 after morning test; Breakout: $168.88 Volume=775K Target=$184 Stop=$165.65
POSITION: BZH EN - May $170c (48 delta)
http://www.investmenthouse.com/cs/bzh.html
New Post-Split Plays:
Play Date: 02/24/2005
MRVL (Marvell Technology--$36.14; +0.17; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/m/mrvl.html
After Hours: $37.65
STATUS: Test breakout. After getting shaken out of MRVL we are looking at it again. It held the 18 day EMA (35.49) after gapping lower Thursday and then rebounded for a modest gain. The story was the surging volume. After hours it reported strong earnings and was up over $1. Not too worried about that; we are going to let it gap and then when it makes its first test we will start a partial position. From there we see what it does and wait until it gives us another entry point. Excellent 4 to 1 accumulation in the base (4 up price weeks on rising volume to 1 down price weeks on rising volume) shows buyers have been moving in. Strong money flow is added spice to the 8 week base. Nice test of the 18 day EMA (35.49) has set up this move.
Volume: 5.84M Avg Volume: 3.223M
BUY POINT: $37.25 Volume=4.5M Target=$43 Stop=$35.89
POSITION: UVM HU - Aug. $37.50c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/mrvl.html
PRE-ANNOUNCEMENT PLAYS
Current Pre-Announcement Plays: This is a list of stocks we are looking to announce splits. We are not in all positions but are letting them set up for the next move. 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.
APPX: No split 2-16-05. Good move higher. Researching the next date as we wait for another entry point.
CMTL: Forecast early March.
CVH: No split 2-22 but strong earnings. Shot higher and took a rest Thursday.
FDX: Forecast mid-March.
FS: Forecast 2-25-05. Nice doji at the 50 day EMA. Now we see if an announcement can give us an entry point.
GPC: No split 2-22-05 before the open. Nice recovery, and if it gives us another good volume move it is a buy as it breaks out from its base.
GPN: Tentatively forecast 3-21-05. Needs to recover. Just watching for now.
IHP: No split announced 2-24-05, but good earnings and a good move.
IR: Researching to pinpoint the exact date.
LAUR: Researching the exact date.
LEH: Tentatively forecast 3-24-05. Trying to hold the 50 day EMA and set up a rebound.
NBL: No split 2-22 but beat earnings by 14 cents. Would like to see more volume as it moves higher
OMC: No split 2-22-05 before the open. Continuing the excellent move higher.
ORLY: Forecast 2-23-05. No split announced but a gap higher on strong volume.
SPLS: Forecast 2-24-05. Announced the split. Could not deliver a lot of pop on the move yet, but many stocks have had delayed responses.
TBL: Researching next date as no announcement 1-20. Continues testing the great move.
TOL: Forecast 2-23-05. No split announced but solid earnings and moving higher again.
TTC: No split 2-22-05. Researching the next date and waiting for another set up.
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:
Play Date: 02/24/2005
CTSH (Cognizant Technology--$45.90; +1.30; optionable): Business software. Forecast to announce a split in early March. Working to pinpoint the exact date.
BACKGROUND: Last announced a 2:1 split on 4-13-04 at $47. Prior to that it announced a 3:1 split on 3-5-03 at $69.80.
http://biz.yahoo.com/p/c/ctsh.html
After Hours: $46.08
STATUS: Test breakout. CTSH blasted out of a short 6 week cup base two weeks back and has since moved laterally as the 10 day EMA (43.92) rose to catch up with it as it consolidated laterally. Volume backed off as it consolidated, and it has started to rebound the past two sessions as CTSH found support at the 10 day. The bottom of the base formed along the 50 day EMA (40.14), an important support point. Excellent money flow is leading higher and relative strength is making the breakout. A solid leader ready for more.
Volume: 2.13M Avg Volume: 1.837M
BUY POINT: $46.11 Volume=2.5M Target=$54 Stop=$44.45
POSITION: UPU GJ - July $45c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/ctsh.html
Play Date: 02/24/2005
SIE (Sierra Health Services--$59.97; +1.09; optionable): Health care plans. Researching to pin down the exact date.
BACKGROUND: Last announced a 3 for 2 split in May 1998 near $40.
http://biz.yahoo.com/p/s/sie.html
After Hours: $59.95
STATUS: Test breakout. SIE has moved laterally the past there weeks, holding above the 18 day EMA (58.03) on mostly lower volume, consolidating the early February breakout move. A short 8 week pattern set the stage for the move, and there was good accumulation during the pattern at 4 to 2. Thursday SIE was moving off the 18 day EMA toward a breakout, but volume was not there. Relative strength is moving toward a breakout as well, a good corroboration of the move.
Volume: 171.8K Avg Volume: 335.636K
BUY POINT: $60.32 Volume=503K Target=$68 Stop=$57.89
POSITION: SIE FL - June $60c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/sie.html
Continuing Pre-Announcement Plays:
Buy not yet hit:
Play Date: 02/12/2005
ANF (Abercrombie & Fitch--$54.32; +1.01; optionable): Apparel stores. No split was announced 2-15-05 and it may take until May for one, but a good pattern. A bit lower than usual for a split for ANF, but a strong move and a 3:2 puts it in similar position as the last split.
BACKGROUND: Last announced a split 5-11-99 at a price of $95.
http://biz.yahoo.com/p/a/anf.html
STATUS: Breakout test. ANF is moving off the 18 day EMA (53.25) and looks to have completed the test of the strong surge in early February. This is the third test of the 18 day after testing the 50 day EMA (50.35) in lat December. Looking for volume to return as it continues this move and then we will move in.
Volume: 853.9K Avg Volume: 1.809M
BUY POINT: $55.12 Volume=2M Target=$62.55 Stop=$53.75
POSITION: ANF EK - May $55c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/anf.html
Play Date: 02/15/2005
FDX (Federal Express--$97.72; +1.08; optionable): Air and freight delivery. Forecast mid-March. Still pinpointing the date.
BACKGROUND: Two splits in the past, one 1996 at $75. The more recent was announced 3-18-99 at $92. It is right there.
http://biz.yahoo.com/p/f/fdx.html
STATUS: Cup w/handle. FDX is moving up off the 50 day EMA (95.70), the level that acted as support in its two week handle to the 10 week base. Solid 3 to 1 accumulation in the pattern (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows net buying and sets up the breakout ahead. Need to see the volume come back in as it moves through the buy point.
Volume: 954.1K Avg Volume: 1.827M
BUY POINT: $98.15 Volume=2.8M Target=$108 Stop=$95.78
POSITION: FDX GS - July $95c (72 delta)
http://www.investmenthouse.com/cs/fdx.html
Play Date: 02/14/2005
IR (Ingersoll-Rand--$81; +1.48; optionable): Machinery. Researching to pinpoint a date but a great pattern.
BACKGROUND: Last split in 1997 at $65.
http://biz.yahoo.com/p/i/ir.html
STATUS: Double bottom w/handle. Volume moved up to average Thursday as IR started off the test of the 50 day SMA (78.35), moving back up to the top of the range in the 3 week lateral move. IR dumped lower Tuesday, but volume was still below average and that move was more of a shakeout than anything else. Looks solid in its 10 week base. Just need to see the volume surge as IR continues the move and makes the break through they buy point.
Volume: 1.172M Avg Volume: 1.133M
BUY POINT: $81.92 Volume=1.7M Target=$90 Stop=$79.57
POSITION: IR FP - June $80c (62 delta)
http://www.investmenthouse.com/cs/ir.html
PRE-SPLIT PLAYS:
Play Date: 02/17/2005
DHI (D.R. Horton--$42.69; +1.98; optionable): Residential construction. Splits 4:3 on 3-17-05
http://biz.yahoo.com/p/d/dhi.html
After Hours: $42.71
STATUS: Test 50 day EMA. DHI jumped off the 50 day EMA (40.08) Thursday on rising though still slightly below average volume. This move follows a full test of the early February rally; good to see DHI hold the 50 day EMA, a key support level, during the market selling. It has repositioned itself to make another good run, and we are ready to enter as it continues this move, preferably on better volume.
Volume: 1.944M Avg Volume: 1.854M
BUY POINT: $42.88 Volume=2.8M Target=$48 Stop=$42.21
POSITION: DHI EH - May $40c (75 delta) &/or Stock
http://www.investmenthouse.com/cs/dhi.html
Play Date: 02/22/2005
RECN (RSCS Connection--$50.15; +0.67; optionable): Management services. Splits 2:1 on 3/2/05
http://biz.yahoo.com/p/r/recn.html
After Hours: $50.17
STATUS: Test 50 day EMA. Edged higher Thursday off the 50 day EMA (48.89), but still on very low, below average volume. Looks to be getting ready to bounce, but it needs to show us a bit of trade as it does. Nice test, and now it needs to show us the bacon. To recap: Big gap up in late December out of a 7 month cup with handle base. It has now come back to test that break higher, filling the gap. It is moving laterally along the 50 day EMA on very low, below average volume. Being patient and letting it show us the break higher on volume.
Volume: 265.287K Avg Volume: 501.181K
BUY POINT: New: 50.32 (orig. $50.12) Volume=525K Target=$55.25 Stop=$48.78
POSITION: JJJ EJ - May $50c (50 delta)
http://www.investmenthouse.com/cs/recn.html
Play Date: 02/19/2005
VMSI (Ventana Medical Sys.--$69.17; -0.51; optionable): Medical instruments. Splits 2:1 on 3-15-05
http://biz.yahoo.com/p/v/vmsi.html
STATUS: Flying plateau. Volume shot higher Thursday as VMSI sold back a bit further but managed to hold the 18 day EMA (69.12) on the close. Still working in a very tight lateral move that is testing the recent break higher. To recap: VMSI broke out from a 5 month flat base in late October and rallied to 65 before it needed a rest. It sold back to the 50 day EMA (69.72) to take the rest and then rebounded back for another move up the short term MA (10 and 18 day EMA); strong stocks show this kind of action when they make their breakouts. This is VMSI's second test of the 18 day EMA since testing the 50 day. Volume has been very low, indicating no selling in the shares as it consolidates at this near support. Looking for volume to jump as it makes a move out of this nice lateral consolidation.
Volume: 244.699K Avg Volume: 138.454K
BUY POINT: $71.12 Volume=150K Target=$77.45 Stop=$69.78
POSITION: UMI FN - June $70c (55 delta)
http://www.investmenthouse.com/cs/vmsi.html
POST SPLIT PLAYS:
Play Date: 02/23/2005
FLIR (Flir Systems--$31.17; -0.13; optionable): Scientific & technical instruments
http://biz.yahoo.com/p/f/flir.html
After Hours: $31.18
STATUS: Cup w/handle. After the strong volume jump Wednesday, FLIR held steady at the 10 day EMA (31.17) on lower, below average volume. Still making a higher low at the 50 day EMA (30.42) on this last test in the pattern that has set the handle. Looks ready to make the move. To recap: The 50 day EMA, the important support level, is acting as support for the handle to the 7 month base. Kind of a jagged pattern, but it has nonetheless formed up well, using the 200 day SMA (28.81) as support on each low. That is where the big money steps in if they want to continue holding the stock. They have, and that has built this base. Solid 7 to 4 accumulation (7 up price weeks on rising volume to 4 down price weeks on rising volume) is an indication of that support as it shows net buying. Looking for volume to continue moving higher as FLIR moves through the buy point.
Volume: 487.446K Avg Volume: 562.045K
BUY POINT: $32.15 Volume=843K Target=$37 Stop=$30.89
POSITION: FFQ GX - July $32.50c (54 delta) &/or Stock
http://www.investmenthouse.com/cs/flir.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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