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Begin part 3 of 3
THE PLAYS:
Good movers: CELG; DIOD; NX
PRE-ANNOUNCEMENT PLAYS
Current Pre-Announcement Plays: Lots of stocks still in position for split announcements. We have some good information on many though some are wild cards, i.e. no split history but hearing word of a possible split announcement. All are good leadership quality stocks that can make us money if they show us the breakout moves.
This is a list of stocks we are looking to announce splits. We are not in all of the potential splits plays 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.
ANF: Potentially forecast for May.
CEPH: Just announced earnings in February, but really like its pattern.
CTSH: Still looking for the next possible date but enjoying the gains.
DBRN: New information. Could give us the announcement on 3-1-06
DRI: Forecast 3-20-06
FRK: Forecast 4-25-06 after the close or 5-3-06
GS: Forecast 3-16-06 before the open.
IEX: Tentatively forecast for third week of April.
IRM: Forecast 3-1-06
ITG: Forecast first week of March.
JEC: Forecast 4-25-06
LM: Researching to pinpoint a date. Right now it looks like late April.
MRVL: Forecast 2-23-06. No split announcement.
ODP: Forecast 2-23-06. No news today but ODP keeps on moving higher.
PNRA: Forecast 4-12-06
POOL: No announcement with earnings on 2-16-06. Making a nice test of its strong surge.
RARE: Tentatively forecast for 4-26-06
VMC: Tentatively set for late April
New Pre-Announcement Plays:
Play Date: 02/25/2006
ANN (Ann Taylor--$35.68; -0.3; optionable): Women's apparel stores. Forecast 3-10-06.
BACKGROUND: Last announce a 3:2 split on 4-29-04 at $40.40.
http://biz.yahoo.com/p/a/ann.html
STATUS: Ascending base. ANN is bumping up against the breakout to a new high, working laterally the past three weeks on low, below average volume. Nice surge off the 50 day EMA (33.72) to start February and then the lateral move. Nice ascending 12 week base formed using the 50 day as support. Money flow is strong and leading higher while accumulation is positive. Excellent same store sales for January jumped it higher off the 50 day EMA. Now it needs to deliver a breakout on a return of strong volume to set the play off right and get ANN moving higher into split range.
Volume: 561.2K Avg Volume: 1.417M
BUY POINT: $36.05 Volume=2M Target=$43 Stop=$34.89
POSITION: ANN FG - June $35c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/ann.html
Play Date: 02/25/2006
BLUD (Immucor--$30.40; -0.10; optionable): Diagnostic substances. Researching date; announced earnings in early January.
BACKGROUND: Last announced a 3:2 split on 11-15-2004 at $31. Before that a 3:2 split on 6-1-04 at $31.20. Announced splits in 2003 and 2002.
http://biz.yahoo.com/p/b/blud.html
STATUS: Cup w/handle. BLUD is working on a 4 week handle to its 9 month base, easing back toward the 18 day EMA (30.00) on low volume. A strong 3 year run from 2002 to mid-2005 required a breather, and this base is doing just that, setting up for a breakout and run to a new all-time high once more. Will let it finish forming the handle; may take a few days. Looking for a volume spike as it makes the break to show us the buyers are ready to push it higher.
Volume: 170.597K Avg Volume: 445.924K
BUY POINT: $31.55 Volume=669K Target=$37.95 Stop=$29.89
POSITION: QMQ FF - June $30c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/blud.html
Play Date: 02/25/2006
CLZR (Canela--$18.69; +0.61; optionable): Medical appliances and equipment. Just announced earnings on 2-1-06. Researching to pinpoint an exact date but like the entry it is giving us.
BACKGROUND: Last announced a 2:1 split on 1-27-04 at $24.50. Before that it announced a 3:2 split on 1-19-00 at $19.
http://biz.yahoo.com/p/c/clzr.html
STATUS: Test breakout. CLZR gapped out of a 21 month base to start the month, following through on a strong early January move. It has come back to fill much of the gap, holding near support at the 50 day EMA (16.30) on very low, below average volume. Last week it started up off that support on a good shot of rising volume. It is butting right up against resistance at 19 that formed from the early February rally. Looking for CLZR to move through that point to give us the entry for the play. Top ranked stock in fundamentals growth to go with its pattern.
Volume: 382.423K Avg Volume: 371.755K
BUY POINT: $19.12 Volume=558K Target=$22.95 Stop=$18
POSITION: UKZ HW - Aug. $17.50c (66 delta) &/or Stock
http://www.investmenthouse.com/cs/clzr.html
Play Date: 02/25/2006
CRDN (Ceradyne--$58.35; +0.65; optionable): Advanced technical ceramic products (no ceramic dogs or roosters here). Forecast to announce a split 2-28-06 before the open.
BACKGROUND: Announced a 3:2 split on 12-20-04 at $53.20. Prior to that a 3:2 split on 3-11-04 at $34.20.
http://biz.yahoo.com/p/c/crdn.html
After Hours: $58.30
STATUS: Test 50 day EMA. Broke out in September that kicked off the current rally, making periodic tests of the 50 day EMA (51.89) to regroup and set up the next run. It is just coming off a test of the 50 day EMA to start the month, rallying back up to the 10 day EMA (56.54) and working laterally at that support the past week. Looking for the next break higher on volume through the buy point to start the play. That may not happen before the close Monday; we would like to see the break on volume as this is an earnings announcement play. We will look at a partial position, however, even without the break higher given CRDN is fundamentally strong as well.
Volume: 441.94K Avg Volume: 721.537K
BUY POINT: $59.48 Volume=1.1M Target=$71.45 Stop=$56.32
POSITION: AUE FL - June $60c (54 delta) &/or Stock
http://www.investmenthouse.com/cs/crdn.html
Play Date: 02/25/2006
GG (Goldcorp--$25.72; +0.81; optionable): Gold. Forecast to announce a split 3-10-06.
BACKGROUND: Last announced a 2:1 split on 2-11-02 at $15.70.
http://biz.yahoo.com/p/g/gg.html
After Hours: $25.70
STATUS: Test 50 day EMA. GG broke out from a 14 week flat base in late December and rallied to end January at a new all-time high (28). It stumbled with many gold stocks after that run, falling to the 50 day EMA (24.08) and price support at 24. Last week it bounced then fell a bit to test and hold the 18 day EMA (25.09). Volume bounced Friday though it was still below average. Looking for a strong surge to carry it through some resistance at 26.
Volume: 2.951M Avg Volume: 3.362M
BUY POINT: $26.38 Volume=5M Target=$31.75 Stop=$24.97
POSITION: GG GE - July $25c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/gg.html
Continuing Pre-Announcement Plays:
Play Date: 02/23/2006
CEPH (Cephalon--$76.4; -0.09; optionable): Drugs. Researching the exact date, but it is ready to move now.
BACKGROUND: No splits in CEPH's history.
http://biz.yahoo.com/p/c/ceph.html
STATUS: Ascending triangle. Tried to continue the move Friday, but again suffered from low volume syndrome. Solid pattern, so just letting it show us the move and we will start the play. To recap: After a strong surge from September to January, CEPH needed a breather. This 6 week pattern formed over the 18 day EMA (73.57) has given it the rest and is ready to propel it higher and continue toward a new all-time high. This is the handle to a long, 4 year double bottom base. Volume has come to life the past three months, indicating plenty of buying in CEPH. That is what will drive it higher out of this current lateral move that shows excellent 4 to 1 accumulation.
Volume: 1.177M Avg Volume: 2.725M
BUY POINT: $76.72 Volume=3M Target=$92 Stop=$74.05
POSITION: CQE HP - Aug. $80c (49 delta) &/or Stock
http://www.investmenthouse.com/cs/ceph.html
Play Date: 02/23/2006
FRK (Florida Rock--$58.88; -0.37; optionable): Cement. Looking at March but researching to pinpoint the date.
BACKGROUND: Frequent splits. Last announced a 3:2 split on 5-4-05 at $59.50.
http://biz.yahoo.com/p/f/frk.html
STATUS: Cup. Took a lower volume breather Friday, reaching down to test near support at the 10 day EMA (57.44) and rebounding for a modest loss. Still a super solid stock ready to move higher. To recap: Working on the right side of a 19 week base, starting the move in late January on strong trade. Big upside volume sessions have punctuated upside surges on this run. Volume was again up Thursday as FRK broke through some resistance in the base at 58. Looking to start the play on a continued move on solid trade and then will add when it forms the handle and breaks out. Excellent 9 to 3 accumulation in the base shows a lot of buying, complementing the surging money flow. Solid.
Volume: 683.6K Avg Volume: 648.726K
BUY POINT: $59.75 Volume=850K Target=$71.75 Stop=$57.05
POSITION: FRK IL - Sept. $60c (52 delta) &.or Stock
http://www.investmenthouse.com/cs/frk.html
Play Date: 02/23/2006
IEX (Idex--$47.56; -0.18; optionable): Engineered industrial products.
BACKGROUND: Last announced a 3:2 split on 4-22-04 at $44.80.
http://biz.yahoo.com/p/i/iex.html
STATUS: Test breakout. Volume backed of to a trickle Friday after two strong, strong volume sessions started the breakout move. IEX faded a fraction Friday, giving it time to catch its breath. That is actually a good thing; it will be set to make the move. Just going to let it start back up to enter the play. To recap: IEX is just coming off of its late January earnings announcement that helped break it out from its 18 week base. This is its second test of that breakout, holding the 18 day EMA on each test. A strong stock will power up that support and IEX is doing that, showing a big doji last Wednesday and a strong surge Thursday, both sessions on strong volume. Ready to start the play with a partial position as it continues higher and then will add on the next test. Strong fundamentals to go along with its great pattern.
Volume: 138.1K Avg Volume: 188.223K
BUY POINT: $48.05 Volume=200K Target=$55.35 Stop=$46.36
POSITION: IEX GI - July $45c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/iex.html
Play Date: 02/04/2006
PNRA (Panera Bread--$71.10; +0.13; optionable): Restaurants. No announcement 2-9-06 after the close. Researching the next date.
BACKGROUND: Announced its only 2:1 split on 4-10-02 at $62.00
http://biz.yahoo.com/p/p/pnra.html
STATUS: Test 18 day EMA. Locked, loaded, and ready to breakout. Or should it be the buns are in the oven and cooking? PNRA has come to a virtual standstill on the 18 day EMA (70.86). The calm before the storm. To recap: PNRA is testing back on low volume, forming another handle to its 9 week cup with handle base. Money flow continues to lead higher. Solid accumulation. Both are setting the stage for this leader to make the breakout.
Volume: 291.089K Avg Volume: 521.994K
BUY POINT: $72.55 Volume=801K Target=$83.25 Stop=$70.35
POSITION: UPA EN - May $70c (58 delta) &/or Stock
http://www.investmenthouse.com/cs/pnra.html
Play Date: 02/09/2006
RARE (Rare Hospitality--$32.04; +0.35; no options): Restaurants. Forecast 4-26-06.
BACKGROUND: Last announced a 3:2 split on 7-23-03 at $35.
http://biz.yahoo.com/p/r/rare.html
STATUS: Double bottom w/handle. Volume has moved up on the upside sessions this month as RARE works laterally over the 50 day EMA (31.10), forming the handle to its 13 week base. It is ready serve us a breakout to a new all-time high.
Volume: 172.2K Avg Volume: 260.716K
BUY POINT: $32.65 Volume=401K Target=$37.65 Stop=$31.45
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/rare.html
Play Date: 02/23/2006
VMC (Vulcan Materials--$79.83; +0.3; optionable): Building materials. Announced earnings to start February. Researching to pinpoint the date.
BACKGROUND: Last split 3:1 on 3-11-99 at $135. The ratio is right for a 2:1 split.
http://biz.yahoo.com/p/v/vmc.html
STATUS: Test breakout. Low volume Friday as VMC pushed slightly higher but still in the lateral range of the past three weeks. Looks solid and just waiting and letting Vulcan show us the logical move to start the play. A strong stock that will let us at least prosper (if not let us live long) if it shows us the strong break higher. To recap: Announced a dividend and stock buy back with earnings so VMC may not be in the market for a split right now, but its pattern is super. VMC is moving laterally above the 10 day EMA (78.29) as that near support moved up to the stock after its big break higher to start the month. Great earnings helped propel VMC to the breakout from its 16 week base that formed along the 50 day EMA (73.58) and sporting strong 5 to 2 accumulation. Money flow is strong and moving higher. Volume is great, showing strong sessions on upside gains. Looking to move in as it breaks through near resistance on some rising, above average volume. A solid leader with great fundamentals as well.
Volume: 448.8K Avg Volume: 559.894K
BUY POINT: $80.11 Volume=800K Target=$92 Stop=$77.45
POSITION: VMC HP - Aug. $80c (52 delta) &/or Stock
http://www.investmenthouse.com/cs/vmc.html
CONTINUING PRE-SPLIT PLAYS:
Play Date: 02/21/2006
SLB (Schlumberger--$118.39; +1.49; optionable): Oil and gas services company. Splits 2:1 on 4-10-06
http://biz.yahoo.com/p/s/slb.html
After Hours: $118.50
STATUS: Test 50 day EMA (112.20). Gapped a bit higher Friday with no volume, closing off the high (120.08). Tapped near the breakout and held the line. Looking for a continued move this week to start the pre-split play. To recap: After a nasty drop this month, SLB jumped off the 50 day EMA Tuesday after three days at that level. Taking another run at it though energy is all over the map right now; SLB has a lot of institutional support and it showed as volume jumped at the 50 day EMA. Would like to see a little more volume as it moves higher. A move to the target lands us a 70%ish gain.
Volume: 4.494M Avg Volume: 5.946M
BUY POINT: $120.11 Volume=8M Target=$130 Stop=$116.95
POSITION: SLB ED - May $120c (53 delta)
http://www.investmenthouse.com/cs/slb.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 02/21/2006
BRO (Brown & Brown--$31.25; +0.25; optionable): Insurance brokers
http://biz.yahoo.com/p/b/bro.html
STATUS: Double bottom w/handle. Very nice handle forming the past week, a classic overall lower volume fade to near support (in this case the 10 day EMA at 30.57). Friday BRO gapped a bit lower toward that level and rebounded. Solid pattern, solid stock. Ready to move. To recap: Solid surge 2 weeks back as BRO broke out over the hump in the 8 week pattern (at 29.47) and rallied higher on strong upside volume. It is fading back, forming a second handle to the base right at the high on the left side of the base. Positive 2 to 1 accumulation in the base shows net buying, setting up BRO for the breakout to a new high once more. Likely to take another couple of sessions to finish forming the handle, and then looking for a high volume breakout when the move resumes.
Volume: 367.1K Avg Volume: 538.669K
BUY POINT: $31.75 Volume=808K Target=$37.95 Stop=$30
POSITION: BRO FF - June $30c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/bro.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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