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Begin part 3 of 3
We apologize for the tardy part 3. Technical difficulties this evening delayed part 3.
THE PLAYS:
Good movers: CRDN
Market leader plays:
Play Date: 02/28/2006
ATHR (Atheros Communications--$20.58; +0.07; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/a/athr.html
After Hours: $20.54
STATUS: Flying plateau. This is the leading sub-sector in semiconductors, and ATHR is a market leader. It broke out from a 10 month base in December and has rallied well. It surged on strong earnings to end January and into February, and has spent the past two weeks working laterally above the 10 day EMA (20.06) on mostly lower, below average volume. The range has tightened up the past week as ATHR holds its gains in the market selling. Money flow is rallying higher ahead of price and we are looking for volume to break back above average as ATHR breaks higher out of this range. Strong fundamentals.
Volume: 748.858K Avg Volume: 1.046M
BUY POINT: $21.45 Volume=1.4M Target=$25.95 Stop=$19.95
POSITION: QRA FD - June $20c (55 delta) &/or Stock
http://www.investmenthouse.com/cS/athr.html
Play Date: 02/28/2006
WITS (Witness Systems--$23.43; -0.48; optionable): Contact center worldwide
http://biz.yahoo.com/p/w/wits.html
STATUS: Breakout test. WITS blasted out of a 16 week flat base to start February, rallying to 24.59 on the high. It peaked out last week and started to faded back this week, heading toward the 18 day EMA (23.24) Tuesday. It is likely to hit that level and then make its next bounce higher. Excellent 7 to 2 accumulation in the base (7 up price weeks on rising volume to 2 down price weeks on rising volume) shows a lot of buying. Nice breakout to a new 6 year high and this test is re-setting the breakout move for the next leg.
Volume: 292.145K Avg Volume: 416.835K
BUY POINT: $23.94 Volume=550K Target=$27.74 Stop=$23.02
POSITION: UPJ FX - June $22.50c (64 delta) &/or Stock
http://www.investmenthouse.com/cs/wits.html
Play Date: 02/28/2006
NURO (NeuroMetrix--$35.92; +0.69; no options): Medical instruments
http://biz.yahoo.com/p/n/nuro.html
After Hours: $35.98
STATUS: Cup w/handle. NURO has scratched out a nicely formed 17 week base as it sets up for a new all-time high. A new issue in June 2004, NURO enjoyed a strong 2005 and needed a breather. This base is almost textbook, and the handle is providing a good shakeout with a reach down to the 50 day EMA (33.57) last week and then a rebound this week. Just need to see more volume as NURO moves through the buy point.
Volume: 119.676K Avg Volume: 234.663K
BUY POINT: $36.31 Volume=352K Target=$43.55 Stop=$34.48
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/nuro.html
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.
ANN: Forecast 3-10-06
BLUD: Researching date.
CEPH: Just announced earnings in February, but really like its pattern.
CLZR: Researching date.
CRDN: No split on 2-28-06 but nice earnings drove it higher.
CTSH: Still looking for the next possible date but enjoying the gains.
DBRN: 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
GG: Forecast 3-10-06
GS: Forecast 3-16-06 before the open.
IEX: Tentatively forecast for third week of April.
IRM: Forecast 3-1-06. Wednesday is the day.
ITG: Forecast first week of March.
JEC: Forecast 4-25-06
LM: Researching to pinpoint a date. Right now it looks like late April.
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: 02/28/2006
GCO (Genesco--$40.6; -0.48; optionable): Apparel stores. Forecast 3-2-06 before the open.
BACKGROUND: No splits in GCO's history but it is getting to that level for a retailer.
http://biz.yahoo.com/p/g/gco.html
STATUS: Cup w/handle. Volume was up Tuesday as GCO tested the 18 day EMA (40.15) on the low and rebounded to recoup some of the loss. Good action in the two week handle to its 12 week cup with handle base that is setting up for a breakout to a new all-time high. Positive accumulation shows continued buying during the consolidation; strong money flow is leading higher as well. Looking for a break higher on continued stronger trade to send it to that new high and to start the play.
Volume: 222.9K Avg Volume: 184.544K
BUY POINT: $41.82 Volume=277K Target=$48.95 Stop=$40.02
POSITION: GCO FH - June $40c (54 delta) &/or Stock
http://www.investmenthouse.com/cs/gco.html
Continuing Pre-Announcement Plays:
Play Date: 02/23/2006
CEPH (Cephalon--$79.48; -1.2; 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
After Hours: $79.56
STATUS: Ascending triangle. Solid gap higher and run Monday on volume, and then a low volume test Tuesday. Likely to come back some more toward the 10 day EMA (76.38) before resuming, but strong stock and we want to be ready to move in if it continues higher from here. To recap: After a strong surge from September to January, CEPH needed a breather. This 6 week pattern formed over the 18 day EMA (74.87) 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: 1.851M Avg Volume: 2.783M
BUY POINT: New: Test toward 77 then 77.45 on the rebound. From the Tuesday close: 79.85 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: 02/25/2006
GG (Goldcorp--$25.45; +0.24; 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
STATUS: Test 50 day EMA. Still holding steady over the 18 day EMA (25.14), but volume spiked Tuesday, moving back above average. That caught our eye and we are watching for the breakout move. To recap: 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 (24.17) and price support at 24. Last week it bounced then fell a bit to test and hold the 18 day EMA. Looking for a strong surge to carry it through some resistance at 26.
Volume: 3.465M Avg Volume: 3.386M
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
Play Date: 02/23/2006
IEX (Idex--$47.25; -0.61; 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. Trying to break free and close to doing it. Gapped a bit higher again Tuesday but gave it back as volume jumped up again. Still holding up well above the 10 day EMA (46.90). Ready to make the move. 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: 288.1K Avg Volume: 188.968K
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: 02/23/2006
VMC (Vulcan Materials--$79; -1.10; 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. Moving laterally still with the range narrowing above the 10 day EMA (78.69). Volume jumped back to average as hit held the 10 day and showed a doji Tuesday. Nice action in a weaker market and still ready to make the 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 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 (74.04) 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: 569.5K Avg Volume: 564.96K
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: 02/18/2006
PPDI (Pharmaceutical Prodcut Dev.--$69.59; -0.4; optionable): Medical labs. Splits 2:1 on 3-1-06
http://biz.yahoo.com/p/p/ppdi.html
After Hours: $70.28
STATUS: Test breakout. Splits Wednesday, and lately strong stocks have been running higher through the split date. Looking for PPDI to give us a good volume move to give us the entry as it moves to a new high after this 4 week test.
Volume: 286.904K Avg Volume: 375.882K
BUY POINT: $35.06 (orig. $68.62) Volume=544K Target=$39.95 Stop=$34.41
POSITION: PJQ GG - July $35c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/ppdi.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 02/21/2006
BRO (Brown & Brown--$31.27; -0.23; optionable): Insurance brokers
http://biz.yahoo.com/p/b/bro.html
STATUS: Double bottom w/handle. Low volume this week as BRO continues moving laterally over the 10 day EMA (30.84). This is great action on a weak session. BRO is showing its leadership quality. Just need the breakout and volume with it. 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: 190.5K Avg Volume: 539.752K
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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