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Begin part 3 of 3
THE PLAYS:
Good movers: ADM; BLUD; CMC; COP; CROX; DLTR; FLIR; HOC; ICE; MON; RS
New Post-Split plays:
Play Date: 04/20/2007
BTU (Peabody Energy--$46.55; +0.96; optionable): Coal
http://biz.yahoo.com/p/b/btu.html
EARNINGS: Announced 4-19-07
STATUS: Double bottom w/handle. BTU is forming a handle to a 19 week base that is part of a larger 12 month pattern. It surged higher to start April on strong volume and then gapped higher on Monday with many of the energy stocks. It then tested back, and Thursday announced earnings that were lower than expected. Even with that news it did not sell further, instead closing right on the 10 day EMA (45.73) on volume that remained steady and just above average volume. Friday it bounced up off that level, but volume was lower and below average. The fact that it did not sell off on the weaker earnings is quite encouraging: there is money that wants to hold the stock. Looking for a bounce on rising volume. This stock has plenty of room to run when it gets going, and again, we like the response to a weaker earnings report. That indicates that investors are looking down the road to growth as opposed to the most recent report. Looking for a hot move higher.
Volume: 4.904M Avg Volume: 5.266M
BUY POINT: $46.97 Volume=7.5M Target=$59.85 Stop=$45.95
POSITION: BTU II - Sept. $45c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/btu.html
Play Date: 04/20/2007
COG (Cabot Oil & Gas--$35.48; +0.82; optionable): Independent oil and gas
http://biz.yahoo.com/p/c/cog.html
EARNINGS: 4-30-07
STATUS: Ascending base. COG distributed some on Thursday, but Friday after a quick tap at the 50 day EMA (33.93) on the intraday low it reversed and put together a nice gain on lower but still above average volume. With the Wednesday test lower to that level as well, it looks as if COG has the sellers worked out of it. Strong money flow is starting to turn back up. COG looks like it is ready to make the jump higher.
Volume: 1.228M Avg Volume: 1.065M
BUY POINT: $35.75 Volume=1.4M Target=$41.95 Stop=$33.88
POSITION: COG GG - July $35c (58 delta) &/or Stock
http://www.investmenthouse.com/cs/cog.html
Play Date: 04/20/2007
MUR (Murphy Oil--$57.06; +0.86; optionable): Oil and gas refining
http://biz.yahoo.com/p/m/mur.html
EARNINGS: 4-25-07
STATUS: Double bottom w/handle. MUR broke out from its 9.5 month base just over a week back and spent the past week consolidating the move, working laterally above the 10 day EMA (55.89) as the energy sector tested its last move higher. Friday it got some new volume and it bounced off the 10 day, starting to clear its lateral consolidation. Part of a much larger base, but MUR looks ready to make the break higher from here.
Volume: 1.637M Avg Volume: 1.445M
BUY POINT: $57.32 Volume=2M Target=$65.95 Stop=$55.48
POSITION: MUR GK - July $55c (64 delta) &/or Stock
http://www.investmenthouse.com/cs/mur.html
Play Date: 04/20/2007
VMSI (Ventana Medical Sys.--$46.80; +1.67; optionable): Instrument reagent systems used in anatomical pathology and drug discovery labs
http://biz.yahoo.com/p/v/vmsi.html
EARNINGS: 4-27-06
STATUS: Double bottom w/handle breakout. VMSI formed a nine-month base and broke sharply higher just over a week back, gapping higher on strong trade as it was upgraded. It tested the move this week, coming back to the 10 day EMA on the Thursday intraday low and rebounding to cut its losses. Friday it gapped back to the upside and rallied past the April highs, confirming the breakout. Volume was lower, but it was still above average on that move. Money flow is surging higher ahead of the price move, and we are looking to move in as VMSI continues the break higher and follows the cash. Heading toward a new all-time high. Nice.
Volume: 551.592K Avg Volume: 380.168K
BUY POINT: $47.12 Volume=570K Target=$54.95 Stop=$45.21
POSITION: UMU II - Sept. $45c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/vmsi.html
PRE-ANNOUNCEMENT PLAYS
We consider many stocks for pre-announcement plays every week. We get information regarding upcoming announcements and other data that leads us to conclude a split announcement is coming. Even then, however, we have to be discriminating. We have to see a strong technical pattern as well, and thus we reject many potential candidates based on a weak technical position. Some we consider have announced, but have not fared well given their technical patterns were weak to begin with.
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 and of course the strong earnings growth that put it in the pattern in the first place.
AAPL: Forecast 4-25-07 with earnings
ADM: Forecast 5-1-07
BA: Tentatively set for 4-245-07
BDX: Forecast 4-25-07
BLUD: No split this past week. Researching next date
CAH: Tentatively forecast for 4-26-07
CELG: Tentatively forecast mid-June
CHTT: Researching the date
CMTL: Forecast in early June
CNMD: Forecast early May
COLM: Forecast first week of May. Earnings 4-26-07
CTRP: Forecast early May.
DLTR: Forecast 5-30-07
EXC: Tentatively set 4-25-07
GOLD: Tentatively set 5-8-07.
ISRG: Tentatively set 4-19-07. Strong jump on the earnings report.
JCI: Gapped higher on strong earnings.
KSS: Forecast 5-17-07
MA: Tentatively set 5-2-07
MCHP: Tentatively set for 4-26-07
MICC: Tentatively set 4-24-07
MM: No split in late March. Researching the next date as we enjoy the good move.
MRO: Forecast 5-1-07
NOV: Tentatively set for first week of May. Earnings 4-27-07. If it gives us a new entry we will take it.
POT: Forecast 4-26-07
RL: Forecast first week of May.
SSYS: Forecast early May. Earnings 4-26-07
THQI: Researching date. Potentially set for early May
VMC: Forecast 4-30-07
VSEA: Tentatively set for early May.
YUM: Tentatively set 5-1-07
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 04/21/2007
SU (Suncor Energy--$81.46; +1.55; optionable): Oil sands, energy refining
http://biz.yahoo.com/p/s/su.html
EARNINGS: 4-26-07
STATUS: Test breakout. SU is working on a big 12 month base, the latter part a 17 week double bottom with handle that broke out just over a week back. It surged to 82 and then tested back last week as energy made its test. It fill the small gap on the move up on Thursday, then gapped higher Friday on rising, above average volume; very good price/volume action. Looking for a continued upside break on continued upside volume.
Volume: 2.628M Avg Volume: 2.58M
BUY POINT: $82.88 Volume=3.5M Target=$94.95 Stop=$79.05
POSITION: SU IQ - Sept. $85c (45 delta)
http://www.investmenthouse.com/cs/su.html
Play Date: 04/20/2007
SUN (Sunoco--$72.39; -0.05; optionable): Oil and gas refining
http://biz.yahoo.com/p/s/sun.html
EARNINGS: 5-2-07
STATUS: Test breakout. SUN formed an 8.5 month double bottom with handle base as part of a larger 14 month correction. In March SUN broke the down trendline as it rallied higher, forming the right leg of the pattern. It broke out in early April and has come back to test that move, holding at the 18 day EMA (72.33) Tuesday through Friday of last week as trade turned lower and below average. It held near support and the breakout as it sits right on top of the two week handle formed to end March. Just going to be patient and let SUN bounce off of this support on stronger volume and follow some very nice money flow higher. Here comes the sun, sun, sun, here it comes (Beatles).
Volume: 3.123M Avg Volume: 3.285M
BUY POINT: $73.11 Volume=4.9M Target=$84.95 Stop=$71.15
POSITION: SUN HN - Aug. $70c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/sun.html
New buy point:
Play Date: 04/20/2007
MRO (Marathon Oil--$100.55; +0.03; optionable): Oil and gas refining
BACKGROUND: No splits in MRO's history
http://biz.yahoo.com/p/m/mro.html
EARNINGS: 5-1-07
STATUS: Breakout test. Showing some good price/volume action Wednesday and again Friday (up on upside sessions) as MRO tries to put the finishing touches on its 4 week lateral consolidation following the mid-March breakout from its 14 week cup w/handle base. Strong breakout, orderly consolidation. Now it just needs to show us the break higher on some of that strong volume.
Volume: 4.922M Avg Volume: 3.727M
BUY POINT: $101.65 Volume=5.6M Target=$116.95 Stop=$98.38
POSITION: MRO GT - July $100c (56 delta)
http://www.investmenthouse.com/cs/mro.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 04/14/2007
BDX (Becton Dickinson--$79.05; +1.03; optionable): Medical supplies, lab equipment, diagnostic products
http://biz.yahoo.com/p/b/bdx.html
EARNINGS: 4-25-07
STATUS: Breakout test. Volume jumped back up above average Friday as BDX gapped higher off the 18 day EMA. It tapped through the buy point and backed off modestly. Nice break higher from a good test. Looking for the move to continue this week and give us the buy point. To recap: BDX surged to end March and in early April, breaking out from its 7 week cup base on excellent volume. It is now testing that move, coming back the past week test the 18 day EMA. Nice set up to take BDX to a new all-time high, and this base with its strong money flow is doing just that. Want to see volume kick up again as it resumes the breakout move. Very solid fundamentals matched to a strong price pattern.
Volume: 1.158M Avg Volume: 1.092M
BUY POINT: $79.05 Volume=1.2M Target=$90.95 Stop=$77.08
POSITION: BDX IP - Sept. $80c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/bdx.html
Play Date: 04/19/2007
MCHP (Microchip--$37.45; +0.09; optionable): Semiconductors
http://biz.yahoo.com/p/m/mchp.html
EARNINGS: 4-26-07
STATUS: Double bottom w/handle. Gapped higher Friday, but volume was even further below average so it gave up the move, closing flat. Still in position to make the breakout if it can get some more trade. To recap: Nice little 8 week base over the 90 day MA is acting as the handle to its larger 13 month base. Volume surged Wednesday as the chips came to life. Looks strong and is a chip ready for a breakout to a new all-time high.
Volume: 1.271M Avg Volume: 2.059M
BUY POINT: $37.95 Volume=3.1M Target=$43.75 Stop=$36.45
POSITION: QMT GG - July $35c (66 delta) &/or Stock
http://www.investmenthouse.com/cs/mchp.html
Play Date: 04/17/2007
YUM (Yum! Brands--$61.07; +0.39; optionable): KFC, Taco Bell, etc.
http://biz.yahoo.com/p/y/yum.html
EARNINGS: 5-1-07
STATUS: Double bottom. Continues the lateral move after surging on Monday. Nice action in a nice pattern. Just waiting for the upside break on rising trade. Some good volume increase Friday; could be YUM's week to show some upside flavor. To recap: YUM broke sharply higher Monday on rising, above average volume, approaching the 'hump' in its 4 month base that is setting the stock up for a breakout to a new high. Took a day off Tuesday on lower trade. Looking at some aggressive positions on another sharp move higher It had the tainted food awhile back and got boxed around. That did not stop it from setting up for a run at a new all-time high.
Volume: 1.271M Avg Volume: 1.377M
BUY POINT: $61.55 Volume=2.1M Target=$70.75 Stop=$59.38
POSITION: YUM GL - July $60c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/yum.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 04/16/2007
ROST (Ross Stores--$34.65; +0.12; optionable): Discount apparel stores
http://biz.yahoo.com/p/r/rost.html
EARNINGS: 5-23-07
STATUS: Cup w/handle. Gapped higher Friday on rising, average volume, but could not hold the move, fading back to the 10 day EMA. Still an excellent pattern set up for the breakout to a new high; Friday just wasn't the day for it to move. To recap: Strong volume Monday as ROST surged off the 50 day EMA that acted as support in the 3 week handle to its 8 week base. This small base formed after the January breakout and run from a 3 year trading range. After that breakout and run it needed a breather; it takes a lot out of you to breakout of a long term base. Like this pattern and like the strong money flow. Retail sales did not hurt the move so we want to see it sustain this strength as it clears the March highs and shows us the buy point.
Volume: 1.31M Avg Volume: 1.345M
BUY POINT: $34.95 Volume=1.6M Target=$40.45 Stop=$33.24
POSITION: REQ HZ - Aug. $32.50c (69 delta) &/or Stock
http://www.investmenthouse.com/cs/rost.html
Play Date: 04/18/2007
SWN (Southwestern Energy--$42.48; +0.61; optionable): Independent oil and gas
http://biz.yahoo.com/p/s/swn.html
EARNINGS: 4-30-07
STATUS: Test breakout. Volume jumped back above average Friday as SWN and the other energy stocks got some trade thrown their way again after the pullback for the week. Recaptured the 18 day EMA, and looking good for a break higher to resume its breakout move. To recap: SWN has faded to the 18 day EMA to test the breakout from its 17 week cup with handle two weeks back. Strong volume on this move higher and a bit high on the Tuesday fade, but that was symptomatic of the entire sector. It held near support, showing a doji Wednesday. This is also the high from December, a good support level. Looking for a high volume jump off of this level to show us the buyers are back in.
Volume: 2.642M Avg Volume: 1.992M
BUY POINT: $43.24 Volume=3M Target=$50.95 Stop=$42.05
POSITION: SWN IH - Sept. $40c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/swn.html
CONTINUING LEADER PLAYS:
Play Date: 04/18/2007
HITT (Hittite Microwave--$45.17; +0.75; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/h/hitt.html
EARNINGS: 4-26-07
STATUS: Double bottom w/handle. HITT broke higher Friday, but volume was not a hit. Still a nice pattern and a chip leader. Looking for some more volume as it continues. To recap: Working on the handle to a 6 month base, using the 10 day EMA as support, bouncing off that near support Wednesday, tapping at the February high that marks the breakout point. Needs some more volume but a leader in its sector. Nice set up.
Volume: 207.916K Avg Volume: 298.062K
BUY POINT: From here on some rising volume (orig. $45.05) Volume=450K Target=$53.95 Stop=$42.68
POSITION: QDH II - Sept. $45c (51 delta, low OI) &/or Stock
http://www.investmenthouse.com/cs/hitt.html
Play Date: 04/19/2007
VCLK (Valueclick--$29.60; +0.36; optionable): Internet advertising services
http://biz.yahoo.com/p/v/vclk.html
EARNINGS: 5-3-07
STATUS: Test breakout. Still a nice test of the 10 day EMA (29.18) in progress as VCLK comes back to near support after breaking to that new high. Excellent set up to resume the breakout run and click off some valuable gain for us. To recap: VCLK gapped lower on the EBAY earnings but managed to hold the 10 day EMA on the close, showing a hammer doji on the candlestick chart. That pullback also put it right on top of the late February high that marks the top of the base. We are looking for VCLK to hold this support and then start to bounce on rising trade. If it does we will move right back in.
Volume: 1.12M Avg Volume: 1.938M
BUY POINT: $29.88 Volume=2.6M Target=$35.45 Stop=$28.95
POSITION: QCS IF - Sept. $30c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/vclk.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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