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us stock market, stock split
Begin part 3 of 3
THE PLAYS:
Good movers: DAKT; GRMN; HWAY; RMD
New Pre-Split Plays:
Play Date: 05/27/2006
B (Barnes Group--$42.76; +1.44; no options): Industrial equipment and components. Splits 2:1 on 6-2-06
http://biz.yahoo.com/p/b/b.html
STATUS: Test 50 day EMA. Nice gap higher in late April took B to 48 on the high. It made a small double top and then sold back in the market selling, falling to and slightly undercutting the 50 day EMA (42.20) on the lows. It made a quick recovery, moving back above that level Friday on some solid above average volume that showed up again on Wednesday. B rallied to the 18 day EMA (42.96) Friday and stalled a bit. Want to see it rally through that level to start the pre-split run and give us the buy point. Nice strong leader that looks ready to make its pre-split move.
Volume: 212.8K Avg Volume: 200K
BUY POINT: $43.04 Volume=300K Target=$49.90 Stop=$41.12
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/b.html
Leader Plays:
Play Date: 05/27/2006
DXPE (DXP Enterprises--$46.05; -0.70; no options): Wholesale industrial equipment. No splits in DXPE's history; this is the first time it has made it to $50 in its 8 year life as a public company.
http://biz.yahoo.com/p/d/dxpe.html
STATUS: 50 day EMA test. DXPE broke out from a 5.5 month cup with handle base in March, starting a solid run up the 18 day EMA (now at 47.49). It rallied to 59 on the move and then needed a deeper test. It came back during the market selling to tap at the 50 day EMA (41.35) and then rebound. Pretty strong in that it did not even hit the 50 day as it sold. Volume faded to end the week as DXPE moved laterally below the 18 day. It did not move much last week either up or down, instead just continuing its test. A strong stock will do that, and we are looking for DXPE to complete the base this week and resume the run higher. DXPE is strong both technically and fundamentally with some of the best sales and earnings growth rates in the market.
Volume: 375.1K Avg Volume: 575K
BUY POINT: $47.88 Volume=675K Target=$58.00 Stop=$44.89
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/dxpe.html
Play Date: 05/27/2006
FORR (Forrester Research--$25.83; -0.04; no options): Research services re impact of technology on business and consumers. One split way back in early 2000. It is finally on the comeback trail.
http://biz.yahoo.com/p/f/forr.html
STATUS: Test breakout. FORR is in the process of digging itself out of a 6 year correction. It has formed two bases over the past 9 months, blasting higher in late April out of an 8 week flat base, running to 27 on the high. It used the market selling to test the breakout. Fading back to the 18 day EMA (25.42) on very low volume, working laterally along that support level the past two weeks. Excellent action and we are looking for it to deliver a high volume break higher this week as it resumes the move. Sold 4 to 2 accumulation in the most recent base (4 up price weeks on rising volume to 2 down price weeks on rising volume) shows plenty of buying; nice complement to the strong money flow.
Volume: 32.8K Avg Volume: 115K
BUY POINT: $26.48 Volume=172K Target=$31.75 Stop=$25.28
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ci/forr.html
Continuing Leader Play:
Play Date: 05/25/2006
DRIV (Digital River--$47.00; +0.23; optionable): e-commerce outsourcing solutions (design, hosting, optimization, etc.)
http://biz.yahoo.com/p/d/driv.html
After Hours: $47.03
STATUS: Ascending base. Bounced modestly higher Friday, but no volume to really push it. That took it closer to the breakout from its base, but it is still working on that move. Just being patient to let this strong stock show us the move. To recap: DRIV broke to a 6.5 year high in mid-March as part of a 3.5 month run off of the lows hit in November 2005. After that move it formed the current 10 week base that has moved roughly laterally in a range from 42.50 to 47.50, making higher lows as the 50 day EMA (44.24) rose to meet it. Excellent 4 to 0 accumulation in the lateral base (4 up price weeks on rising volume to 0 down price weeks on rising volume) shows buyers still want the stock. Moved up toward the top of the range this week but volume has remained below average. Nice pattern but we are not going to rush it. Just going to let it show us the break higher with some strong volume to show us the buyers are piling in again.
Volume: 644.842K Avg Volume: 966.428K
BUY POINT: $47.55 Volume=1.5M Target=$57.00 Stop=$45.57
POSITION: DQI II - Sept. $45c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/driv.html
Downside: Want to be ready to move the other way if this rebound fails.
Play Date: 05/27/2006
BJS (BJ Services--$35.33; +0.27; optionable): Oil and gas service company
http://biz.yahoo.com/p/b/bjs.html
STATUS: Double top. BJS was one of those hit energy stocks, surging in January, selling off, then surging back up in April. It set up a very nice cup with handle base but when it came time to deliver the breakout it reversed. It sold off hard, down to 32 on the low. Last week it bounced back, modestly retaking the 200 day SMA (35.27). Volume was lower, however, and intraday BJS tapped the 50 day SMA (36.25) and faded. Looks as if this rebound attempt has just about run out of gas. Looking to move in to the downside move as it rolls back over. A move to the target lands us a 50%ish gain.
Volume: 5.104M Avg Volume: 5.25M
BUY POINT: $35.09 Volume=5.5M Target=$32.50 Stop=$35.55
POSITION: BJS SG - July $35p (-40 delta)
http://www.investmenthouse.com/cs/bjs.html
Play Date: 05/27/2006
PGNX (Progenics Pharmaceutical--$21.79; +0.10; optionable): Drugs
http://biz.yahoo.com/p/p/pgnx.html
STATUS: Put. PGNX double topped in late February and started the current ongoing downtrend. It has used the 18 day EMA (21.98) as resistance, bouncing up to that level and then starting another $3+ decline. Last week it used the overall market rebound to rebound itself, coming back to the 18 day EMA on stronger volume Tuesday but then declining volume to end the week. A tight doji at the 18 day EMA Friday indicates PGNX is ready to make the next move lower in its trend. A move to the target lands us a 44%ish gain.
Volume: 174 Avg Volume: 265K
BUY POINT: $21.59 Volume=300K Target=$20.00 Stop=$22.05
POSITION: GUB SX - July $22.50c (-56 delta)
http://www.investmenthouse.com/cs/pgnx.html
PRE-ANNOUNCEMENT PLAYS
We have considered many stocks for pre-announcement plays over the past few weeks, but have rejected many based on their technical pattern being too weak to do us any good, split or no. Many we considered have announced, but have not fared well given the market was top-heavy and ready to sell or their technical patterns were garbage. LOW is a classic example. We figured it would announce a split but it is in a 3 month downtrend, and a stock split announcement is not likely to reverse a weak pattern. Low announced and bounced $1.38, but is still below resistance.
The key today is to find stocks in strong patterns or that are ready to rebound off support. A split announcement will amplify the move higher in these cases as we enjoy moves from strong leaders in position to run higher. We won't chase a stock in a poor technical position even if we know it is going to split; it simply won't do us any good, i.e. it won't make us any money to the upside. We could list all stocks we think are going to split, but again, that won't make us any money unless we are in an office pool as to what stocks will or won't announce a stock split.
Current Pre-Announcement Plays:
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.
BA: Researching the date. Wildcard with no prior splits.
ESI: Researching the date.
FTI: Wildcard with no split history, but starting back up after an excellent test.
HWAY: Forecast 6-20-06
LCAV: Researching split date
PLCE: Looking at the shareholder meeting on 6-22-06. Still struggling to try and recover the 50 day EMA.
RNT: Forecast in mid-July
SHFL: Forecast in June. Seems to have survived the downgrade, moving laterally in a narrowing range to close out the week. Still watching for a better set up to start a new play.
SNDK: Researching the date. Struggling a bit just below the 50 day EMA but still working laterally in the big picture.
TRMB: Researching the potential split date
WCN: Forecast 5-25-06. No split announcement last week and rebounded nicely Friday to the 50 day EMA. Will see if it can set back up for a buy.
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 05/27/2006
FDS (Factset Research--$46.78; +1.75; optionable): Economic and financial data to investment sector. Forecast in July.
BACKGROUND: A bit early for FDS, but it is starting to move. It last announced a split 1-10-05 at $54.60.
http://biz.yahoo.com/p/f/fds.html
STATUS: Ascending base. Nice gap higher Friday on strong, above average volume as FDS cleared its 10 week base that formed along the 18 day EMA (44.49). Nice move Friday on no volume. That caught our eye, but equally impressive is the 8 to 2 accumulation the last 5 months as FDS formed a base on base pattern (8 up price weeks on rising volume to 2 down price weeks on rising volume). Nice break higher taking FDS to a new all-time closing high. Ready to start positions on a further move higher and then again on a successful test.
Volume: 553.5K Avg Volume: 290K
BUY POINT: $46.95 Volume=375K Target=$55.97 Stop=$44.32
POSITION: FDS II - Sept. $45c (64 delta) & /or Stock
http://www.investmenthouse.com/cs/fds.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 05/06/2006
LCAV (LCA-Vision--$55.85; +0.24; optionable): Laser vision centers. Announced earnings 4-25-06. Researching split date.
BACKGROUND: Last announced a 3:2 split on 11-17-04 at $32.20.
http://biz.yahoo.com/p/l/lcav.html
STATUS: Test breakout. Still ready to make the move, tapping the 18 day EMA (55.02) on the Friday low and rebounding for a modest gain on next to no volume. Just being as patient as we can be, letting it set up and then show us the breakout move. To recap: LCAV gapped higher 4 weeks back on very strong volume, rallying on strong earnings results. That move took it out of an 11 week cup base in one quick move. It has spent the past three weeks testing, a lateral move with on low, below average volume. Positive accumulation in the base shows net buying as LCAV sets up for a new all-time high with a continuation of its breakout move.
Volume: 197.65K Avg Volume: 616.75K
BUY POINT: $57.98 Volume=1.1M Target=$69.50 Stop=$55.00
POSITION: JVQ IL - Sept. $60c (49 delta) &/or Stock
http://www.investmenthouse.com/cs/lcav.html
Play Date: 05/24/2006
RNT (Aaron Rents--$27.03; -0.14; no options): Rental & leasing services. Forecast for mid-July
BACKGROUND: Last announced a 3:2 split on 7-12-04 at $32.60. Before that a 3:2 split on 7-21-03 at $27.20.
http://biz.yahoo.com/p/r/rnt.html
STATUS: Test breakout. Still testing, holding the 18 day EMA (26.87) on very low volume Friday. This should wrap up the test and we look for RNT to give us the move this week. To recap: Broke out from a 8 month cup with handle base in February and rallied up the 18 day EMA. It topped in late April and fell below the 50 day EMA (26.53) but rebounded last week on strong volume, making a new breakout, or really continuing the prior breakout run. After that Friday blast higher RNT faded back for the past week to test the 18 day EMA to close out the week. Relative strength broke out on the move, a very good indication for the continued move higher. Strong money flow is leading higher and after this test RNT is ready to follow it once more.
Volume: 146K Avg Volume: 294.903K
BUY POINT: $28.35 Volume=398K Target=$34.00 Stop=$26.37
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/rnt.html
CONTINUING PRE-SPLIT PLAYS
Play Date: 05/25/2006
EXPD (Expeditors Intl.--$98.62; +1.13; optionable): Air delivery. Splits 2:1 on 6-26-06
http://biz.yahoo.com/p/e/expd.html
After Hours: $97.77
STATUS: Test breakout. The range is still tightening as EXPD moves laterally just below the 10 day EMA (98.91) on low volume, setting up the next break higher for its pre-split run. Looks just about ready. Like how it went about its own business and didn't just run higher with the market before it was ready. To recap: Big gap higher in early May on the announcement and a three week pullback since, filling part of the gap and finding support at 95 the past week. Mostly lower volume on the pullback and then traded kicked up this week in the market volatility as EXPD showed some intraday volatility but held its range. Looking for a break higher on some better volume to enter this play. A move to the target lands us a 80%ish gain.
Volume: 547.475K Avg Volume: 1.071M
BUY POINT: $98.95 Volume=1.5M Target=$110.00 Stop=$95.05
POSITION: URP HS - Aug. $95c (66 delta)
http://www.investmenthouse.com/cs/expd.html
Play Date: 05/22/2006
MAR (Marriott--$73.14; +0.49; optionable): Hotels, executive lodging. Splits 2:1 on 6-12-06
http://biz.yahoo.com/p/m/mar.html
STATUS: Test 50 day EMA. Undercut this support early last week but then reversed Wednesday on strong volume (similar to many stocks) and finished the week just below the 18 day EMA (73.30). Good test, good recovery. With the split just a couple of weeks away it is now in the 'red zone' for a move. Given the test we are looking for it to move this week.
Volume: 751.1K Avg Volume: 1.032M
BUY POINT: $73.85 Volume=1.3M Target=$82.95 Stop=$71.78
POSITION: MAR JN - Oct. $70c (68 delta) &/or Stock
http://www.investmenthouse.com/cs/mar.html
CONTINUING POST-SPLIT PLAYS
Play Date: 05/25/2006
DGX (Quest Diagnostics--$56.24; -0.72; optionable): Medical labs
http://biz.yahoo.com/p/d/dgx.html
STATUS: Test 18 day EMA. Faded Friday on rising but still below average volume, holding the recent lows in this range at 56. There is support here and want to see it hold this level this week to show us it has strength (given that gap higher in mid-April). That means we want to see strong upside volume as it makes its move. To recap: DGX is making its second test of its April breakout from an 11 month base that took DGX to a new all-time high. Huge gap higher on the breakout move, followed by a test of the 10 day EMA (57.04) in early May. That precipitated another move higher and during the last week in the selling it faded back for its second test, but unlike other stocks it did so on very low volume. DGX has roughly held the 18 day EMA (56.76) on the closes, setting up the next run higher in this breakout move. Solid money flow is leading higher even as DGX makes this second test. Ready to move in as volume jumps back up as DGX moves up through the 10 day EMA.
Volume: 1.084M Avg Volume: 1.122M
BUY POINT: $57.65 Volume=1.2M Target=$66.50 Stop=$55.68
POSITION: DGX KK - Nov. $55c (62 delta) &/or Stock
http://www.investmenthouse.com/cs/dgx.html
Play Date: 05/22/2006
VMSI (Ventana Medical Sys.--$47.40; +0.16; optionable): Medical instruments
http://biz.yahoo.com/p/v/vmsi.html
STATUS: Test breakout. Bounced early last week and looked ready to continue the breakout move after the test at the 50 day EMA (44.03) the week before, but it ran out of volume to end the week and wandered laterally below 48. Still solid, just a bit of a respite before continuing the breakout move. To recap: Tremendous breakout in late April, blasting out of an 11 month base on strong earnings. It came back to test the break over the next two weeks, but it held the move, rebounding before hitting the 50 day EMA. Moved up the past week as the market sold, showing some better volume. Money flow is running higher, and relative strength broke out ahead of price, a bullish indication for VMSI to follow it higher. Nice leader that last split in March 2005, set up in the new base, and is not ready for the next run.
Volume: 217.304K Avg Volume: 311.509K
BUY POINT: New: $48.05 (orig. $47.85) Volume=425K Target=$56.95 Stop=$45.32
POSITION: UMI II - Sept. $45c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/vmsi.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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us stock market
stock split
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