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Begin part 3 of 3
THE PLAYS
Good movers: PIXR; PSUN; MHP
New Pre-Split Plays:
Play Date: 03/31/2005
CBI (Chicago Bridge & Iron--$44.03; +0.99; optionable): General contractors. Splits 2:1 on 4-1-05
http://biz.yahoo.com/p/c/cbi.html
STATUS: Test 50 day EMA. CBI broke out in November from a 10 month cup base, and this is its second test of the 50 day EMA (42.92) after that move. A nice low volume test of this key support level with volume surging Thursday as the stock jumped off support after showing a nice, tight doji at that level Wednesday. A solid leader that took a breather at key support and looks ready to move. Using options on this rebound to leverage our gain.
Volume: 567.7K Avg Volume: 222.227K
BUY POINT: $44.64 Volume=250K Target=$50 Stop=$42.78
POSITION: CBI GV - July $42.50c (64 delta)
http://www.investmenthouse.com/cs/cbi.html
Play Date: 03/31/2005
KBH (KB Home--$117.46; +1.63; optionable): Residential construction. Splits 2:1 on a date to be announced
http://biz.yahoo.com/p/k/kbh.html
STATUS: Test 50 day EMA (113.96). After a strong run from 80 to 125 from October to February, KBH double topped and fell back to the 50 day. It ahs spent the past three weeks working at that level, bouncing only to come back to test it once more in the past week. It held and has bounced the past two sessions though volume has trailed off to well below average. Homes are under pressure and that makes this something of a more aggressive play. That is why we want to see volume jump back above average as it moves through the buy point. If it does we will strap on and squeeze as much out of the move as we can.
Volume: 1.099M Avg Volume: 1.382M
BUY POINT: $118.22 Volume=1.8M Target=$125 Stop=$117
POSITION: KBH GV - July $120c (46 delta)
http://www.investmenthouse.com/cs/kbh.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.
AHC: Forecast 4-26-05
APPX: Forecast 4-20-05
ARO: No split announcement 3-10-05. Was a bit early for ARO to announce another split, but the pattern continues to form up very well.
BOL: Forecast 4-19-05 before the open.
CNMD: Forecast 5-17-05
CTSH: Forecast 4-11-05 or 4-19-05.
CVH: Tentatively forecast 5-3-05 before the open.
ESRX: Forecast 4-26-05.
GPN: No split announced 3-21-05. Not giving any of the gain back as it moves even higher.
GVA: Forecast 4-27-05
IEX: Forecast to announce on or about 4-21-05
IHP: Forecast 4-8-05 in conjunction with a board meeting. Struggling.
IR: Forecast 4-6-05 with a board meeting or 4-9-05 with earnings. Not looking good as it tests the 50 day EMA breach.
MON: Forecast 4-6-05
OMC: Forecast 4-26.05 in conjunction with earnings or 5-24-05 with a board meeting.
ORLY: Forecast 4-26-05. Needs more volume as it makes this move.
PD: Forecast in late April. Jumping all over the map. Too volatile right now to get involved with.
PSUN: Forecast early May.
SIE: Forecast 4-25-05
STR: Early May. Breaking higher off the 18 day EMA. Looking solid.
UNH: Forecast 4-14-05 before the open or 5-12-05 with a board meeting.
VLO: Forecast mid-April.
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: 03/31/2005
IMDC (Inamed--$69.88; -0.12; optionable): Medical appliances. Forecast to announce a split in May. Researching to pinpoint the date.
BACKGROUND: Last announced a 3:2 split on 11-4-03 at $87.60.
http://biz.yahoo.com/p/i/imdc.html
STATUS: Double bottom w/handle. IMDC may have to run some to get to split price, but we like the short 7 week base that has formed over the 50 day EMA (67.51). This small consolidation follows the January breakout from a larger 6 month base and run to 72.50. Nice 6 to 3 accumulation (6 up price weeks on rising volume to 3 down price weeks on rising volume) shows net buyers, and the low volume as it moves sideways shows few sellers. Nice, tight handle the past week over the 10 day EMA (69.16) is weeding out the last sellers. Getting ready to make the move and follow the sharply rising money flow higher.
Volume: 185.254K Avg Volume: 361.181K
BUY POINT: $70.44 Volume=600K Target=$80 Stop=$69.05
POSITION: UZI GN - July $70c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/imdc.html
Play Date: 03/31/2005
PII (Polaris--$70.23; -0.03; optionable): ATV's, personal watercraft. Forecast to announce a split 4-14-05.
BACKGROUND: Last announced a 2:1 split on 1-22-04 at $86.
http://biz.yahoo.com/p/p/pii.html
STATUS: 50 day EMA test. Volume spiked Thursday as PII showed its second hammer doji at the 50 day EMA (70.03) after fading back to test this important support level. A short double bottom in January set up a breakout and run from 65 to 75, and this pullback the past three weeks is testing that move. Money flow remains strong, and we are looking for continued strong volume as it moves up through the 18 day EMA (71.48). That is our initial entry point.
Volume: 727.9K Avg Volume: 320.363K
BUY POINT: $71.55 Volume=481K Target=$79.65 Stop=$69.89
POSITION: PII FN - June $70c (56 delta)
http://www.investmenthouse.com/cs/pii.html
Play Date: 03/31/2005
VLO (Valero Energy--$73.27; +2.87; optionable): Oil and gas refining. Forecast to announce a split in mid-April.
BACKGROUND: Last announced a 2:1 split 0n 7-15-04 at $76.60. Last week the CEO said VLO was considering another split in the future.
http://biz.yahoo.com/p/v/vlo.html
After Hours: $73.37
STATUS: Test 18 day EMA. VLO shook us out earlier for more of a modest gain than we wanted, but it held the 18 day EMA (69.82) and then gapped higher Thursday on strong, above average volume. It remains one of the strongest in the group of refiners, and as it moves past the high of a week back we are looking to move in.
Volume: 7.544M Avg Volume: 4.587M
BUY POINT: $73.85 Volume=5.5M Target=$84 Stop=$70.48
POSITION: VLO F0 - June $75c (51 delta) &/or Stock
http://www.investmenthouse.com/cs/vlo.html
Continuing Pre-Announcement Plays:
Buy not yet hit:
Play Date: 03/29/2005
CNMD (Conmed--$30.12; +0.09; optionable): Medical appliances and equipment. Forecast to announce a in early May in conjunction with earnings or on May 17 with its annual shareholder meeting.
BACKGROUND: Last announced a 3 for 2 split on 8-9-01 in conjunction with a board meeting. The stock price was $32. The annual shareholder meeting is scheduled for 5-17-05 at 3:30 ET. The company has sufficient shares for a 3 for 2 split.
http://biz.yahoo.com/p/c/cnmd.html
After Hours: $30.15
STATUS: Cup w/handle. Volume jumped again Thursday, the second surge in three sessions, as it strains at the breakout point from its 16 week base. Excellent 6 to 2 accumulation in the pattern shows a lot of buying during the consolidation. Relative strength has made the breakout already, a bullish sign for the stock to follow. Looks ready.
Volume: 379.728K Avg Volume: 183.227K
BUY POINT: $30.55 Volume=300K Target=$34.75 Stop=$29.44
POSITION: KQD HF - Aug. $30c (58 delta) &/or Stock
http://www.investmenthouse.com/cs/cnmd.html
Play Date: 03/10/2005
IEX (Idex--$40.35; -0.15; optionable): Engineered industrial products. Forecast to announce a split on or about 4-21-05.
BACKGROUND: Last announced a 3:2 split on 4-22-04 at $44.80.
http://biz.yahoo.com/p/i/iex.html
STATUS: Test 50 day EMA. Volume jumped back above average Thursday as IEX continued its 50 day EMA test (39.85). A solid 3 month base and breakout, and now a good test. Strong money flow is leading higher even as the stock drifts back to shake out the last sellers. Looking for more volume as it continues higher through the buy point.
Volume: 267.5K Avg Volume: 217.272K
BUY POINT: $41.11 Volume=348K Target=$46 Stop=$50.05
POSITION: IEX GH - July $40c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/iex.html
PRE-SPLIT PLAYS:
Play Date: 03/22/2005
COH (Coach--$56.63; -0.21; optionable): High end purses, etc. Splits 2:1 on 4-5-05
http://biz.yahoo.com/p/c/coh.html
STATUS: 50 day EMA test. A perennial leader, COH has come back on low volume to test and hold the 50 day EMA (56) following a nice gap higher out of an 8 week double bottom base in early March. Strong retail sales shot it higher, and with the sales figures set to come out next week, COH may try to get a head start. We want to be ready and see some solid trade as it moves higher.
Volume: 902.4K Avg Volume: 1.224M
BUY POINT: $57.24 Volume=1.4M Target=$64 Stop=$55.78
POSITION: COH HK - Aug. $55c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/coh.html
POST SPLIT PLAYS:
Play Date: 03/12/2005
CHD (Church & Dwight--$35.47; +0.19; optionable): Cleaning products
http://biz.yahoo.com/p/c/chd.html
STATUS: 50 day EMA test. Bounced off the 50 day Thursday, but volume remained well below average. A very orderly test with money flow rising even as the stock tests back. Looking for the stock to follow that money higher. To recap: A strong move higher from late January to early February took CHD higher from its last test of the 50 day. CHD split in early September during the formation of its base. Now it is setting up to continue the breakout run. Money flow is strong and volume has spiked higher the past two weeks when CHD made jumps off the 50 day EMA in the face of the market selling.
Volume: 151.7K Avg Volume: 265.409K
BUY POINT: $36.05 Volume=393K Target=$42.45 Stop=$34.96
POSITION: CHD GG - July $35c (60 delta) &/or Stock
http://www.investmenthouse.com/cs/chd.html
Play Date: 03/30/2005
MATR (Matria Healthcare--$30.71; +0.45; optionable): Home health care
http://biz.yahoo.com/p/m/matr.html
After Hours: $30.56
STATUS: Cup w/handle. A big more volume Thursday as MATR was up and down, closing out with a gain. Wanted to see a bit more trade, but it still is a buy on a continued move with some trade. Very nice little base. To recap: A short but nice 8 week base has formed over key support at the 50 day EMA (28.52) as it sets up for a breakout to a new all-time high. Excellent 4 to 0 accumulation (4 up price weeks on rising volume to 0 down price weeks on rising volume) shows all buying as it sets up for the move. Strong money flow is leading higher and relative strength is ready to make a breakout as well, a good corroboration of any breakout move. It formed this base right after it split, not atypical action. We like to look at post split plays after their first base following the split as that resets the clock so to speak and they make the next move higher.
Volume: 160.044K Avg Volume: 195.064K
BUY POINT: $30.64 Volume=353K Target=$36.85 Stop=$29.11
POSITION: PQT FF - June $30c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/matr.html
Play Date: 03/28/2005
URBN (Urban Outfitters--$47.97; +0.29; optionable): Apparel stores
http://biz.yahoo.com/p/u/urbn.html
After Hours: $47.90
STATUS: Test 50 day EMA. A post-split. No a pre-announcement. Hold it. URBN is both a post split and a pre-announcement! It was up again on better volume Thursday, but the move was up and down and anemic. Still looking for something more definitive as it makes the break higher. To recap: It just split last July so we may be a bit early. Broke out from a 16 week cup with handle base of sorts and rallied as the market sold. The past two weeks it took a lower volume breather, coming back toward the 50 day EMA (45) but holding easily above that level. Just needs more volume as it is jumping off the 50 day. Solid leader that is starting the next move.
Volume: 1.163M Avg Volume: 1.137M
BUY POINT: $47.87 Volume=1.2M Target=$53.95 Stop=$45.55
POSITION: URQ FI - June $45c (75 delta) &/or Stock
http://www.investmenthouse.com/cs/urbn.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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