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Begin part 3 of 3
THE PLAYS:
Good movers: BA; RIMM; SBUX
New Post-Split Plays:
Play Date: 05/24/2007
GME (Gamestop--$35.21; -0.64; optionable): Video games stores
http://biz.yahoo.com/p/g/gme.html
EARNINGS: Announced 5-23-07
STATUS: Test 18 day EMA. GME announced some solid earnings this week but it had already put in a good move ahead of the number and the result was anticlimactic. It has come back to test, tapping the 18 day EMA (34.81) on the intraday low Thursday and rebounding modestly. Lower volume on the session so no dumping, just a pullback. This is testing the breakout from a 6 week lateral base GME broke higher from two weeks back. May come back to test the 18 day EMA once again, but want to be ready to step in as GME rebounds off of this test of near support.
Volume: 3.189M Avg Volume: 2.275M
BUY POINT: $35.57 Volume=3.5M Target=$40.95 Stop=$34.62
POSITION: GME JG - Oct. $35c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/gme.html
Play Date: 05/24/2007
KWK (Quicksilver Resources--$42.55; -1.14; optionable): Independent oil and gas
http://biz.yahoo.com/p/k/kwk.html
EARNINGS: 8-8-07
STATUS: Breakout test. KWK surged higher to start this week, breaking out from a 6 month ascending base. Strong volume as it made the move. It is coming back to test, tapping the 18 day EMA Thursday on the low on low, below average volume trade. Part of a larger 16 month cup base, and this is a good stepping stone base for a run back up toward the prior high near 50. Very solid earnings growth and a very nice technical pattern.
Volume: 779.04K Avg Volume: 887.123K
BUY POINT: $43.55 Volume=1.1M Target=$49.95 Stop=$41.95
POSITION: KWK IH - Sept. $40c (72 delta) &/or Stock
http://www.investmenthouse.com/cs/kwk.html
Play Date: 05/24/2007
NKE (Nike--$54.47; -0.35; optionable): Sports apparel, sporting goods
http://biz.yahoo.com/p/n/nke.html
EARNINGS: Announced 6-26-07
STATUS: Breakout test. NKE broke higher Monday, moving out of a 12 week ascending base on some solid, above average volume. The move took NKE to a new all-time high and it is testing on lower volume. Likely to come back to the 10 day EMA (54.04) before this test is complete. We are looking to pick it off of that level as it rebounds on some solid volume.
Volume: 2.816M Avg Volume: 3.099M
BUY POINT: $54.68 Volume=3.6M Target=$62.95 Stop=$53.22
POSITION: NKE JX - Oct. $52.50c (65 delta) &/or Stock
http://www.investmenthouse.com/cs/nke.html
New Leader Play:
Play Date: 05/24/2007
VCLK (Valueclick--$32.14; -0.49; optionable): Internet advertising services
http://biz.yahoo.com/p/v/vclk.html
EARNINGS: Announced 5-2-07
STATUS: Test breakout. VCLK broke out from a 12 week ascending base late last week on the announcement MSFT was paying way too much for AQNT. That leaves little old VCLK as the only company in the sector left. So, VLCK ran higher close to 37 on that news. It has faded back, coming back on lower and lower volume, showing few sellers. It is likely to come on back to the 10 day EMA (30.98) before bouncing back up. We will look for that test and a bounce as our entry point. Of course if it starts up from here on some solid trade we will look at opening some positions.
Volume: 4.217M Avg Volume: 3.719M
BUY POINT: $31.65 Volume=5.6M Target=$37.95 Stop=$29.89
POSITION: QCS IF - Sept. $30c (66 delta) &/or Stock
http://www.investmenthouse.com/cs/vclk.html
Downside:
Play Date: 05/24/2007
PRFT (Perficient--$20.36; -0.08; optionable): Software
http://biz.yahoo.com/p/p/prft.html
EARNINGS: Announced 5-10-07
STATUS: Double top. Good breakout in early April and then a test of the 50 day EMA (20.95). It tried to continue the breakout but failed, falling through the 50 and 90 day MA (20.68) last week on some heavy volume. It has rebounded to test, but could not get through the 90 day MA. Volume jacked on up well above average Thursday as PRFT tapped the 90 day MA on the high and then closed lower. Looking for a fall toward the 200 day SMA (18.12). Our initial target is more conservative, and a move to that level lands a 43%ish gain.
Volume: 590.464K Avg Volume: 403.643K
BUY POINT: $20.24 Volume=400K Target=$18.86 Stop=$20.75
POSITION: UTJ SD - July $20p (-40 delta)
http://www.investmenthouse.com/cs/prft.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.
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 typically 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.
ANF: Looking at 5-23-07 after the close. No split announcement but a nice jump on the earnings result.
BA: Researching date. Upgraded and rallied higher so we took some of the gain.
BDX: No split announced 4-25-07. Trying to put in the bounce off of the 90 day MA.
BHI: Lower volume on the last taps at the highs. Will see how it holds on this test.
BIDU: Forecast in June.
CELG: Tentatively forecast mid-June. Earnings 5-2-07. Fell to the 18 day EMA on rising volume.
CHTT: Forecast third week of July
CLB: Earnings 4-23-07. Researching the date.
CNQ: Earnings were 5-3-07. Researching the date
CTRP: Forecast 5-16-07. No split announcement but a big move on earnings. Coming back to the 18 day EMA after the strong surge.
DLTR: Forecast 5-30-07
DVN: Forecast last week of June.
FOSL: Forecast 5-16-07. Closed it out after a lower volume high.
GVA: Researching date. Faded back to the 10 day EMA on rising volume.
HURN: Wildcard. Researching date.
MA: Researching the next date.
NOV: Earnings 4-27-07. Fell through the 18 day EMA on strong volume.
OSK: Forecast last week of July, first week of August
PENN: Earnings 4-26-07. Modest fade back after that gap higher.
RIMM: Early June
TMO: Researching to pinpoint the date.
XTO: Tentatively set for early June.
CONTINUING PRE-SPLIT PLAYS:
Play Date: 05/16/2007
GILD (Gilead Sciences--$82.33; -0.24; optionable): Biotech.
http://biz.yahoo.com/p/g/gild.html
STATUS: Flying plateau. Still working laterally, coming back from the session low that undercut the 18 day EMA (82.42) but then recovered. Nice recovery in a very weak market. Going to be patient and let it show us the break higher if it will. To recap: Tried to make the break Tuesday, bouncing off the 18 day EMA on the low and darn near making the breakout from the 5 week lateral move. Volume was still below average so it did not have the push to make the move. Really like the action we are seeing and anticipate GILD making the move.
Volume: 3.997M Avg Volume: 4.298M
BUY POINT: $84.38 Volume=6.5M Target=$94.95 Stop=$81.89
POSITION: GDQ HQ - Aug. $85c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/gild.html
Play Date: 05/22/2007
VSEA (Varian Semiconductor--$60.85; -0.22; optionable): Chip equipment. Splits 3:2 on 5-31-07
http://biz.yahoo.com/p/v/vsea.html
EARNINGS: Announced 4-26-07
STATUS: Pre-Split. Another stock that pretty much shrugged off the Thursday selling, holding steady and showing a hammer doji just over support at 60. Low volume on the modest loss as VSEA continues about its business of the test. Just going to let it show us the break higher on strong volume. To recap: VSEA gapped massively higher in late April on its earnings report and split announcement, hitting 70 on that session. Though VSEA preceded this gap with a three week lateral move, the run higher ahead of that was solid and it needed a breather. It has spent May coming back to test that move and over the past week has tapped at 60 twice intraday, rebounding to close higher. Tuesday it showed the same action but posted a nice gain on a solid rise in volume back up to average. Money flow is rallying ahead of price. Looks as if VSEA is ready to give us a pre-split move here.
Volume: 1.307M Avg Volume: 1.56M
BUY POINT: $63.55 Volume=2M Target=$72.95 Stop=$61.32
POSITION: UES HL - Aug. $60c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/vsea.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 05/14/2007
VMSI (Ventana Medical Sys.--$50.51; -0.49; optionable): Medical instruments
http://biz.yahoo.com/p/v/vmsi.html
EARNINGS: Announced 4-27-07
STATUS: Flying plateau. VMSI continues the lateral test after that April run higher to 52. It has tested this month, holding the 18 day EMA (49.75) on the lows. Even tested that intraday Thursday and rebounded to the 10 day EMA. Despite all the selling in the market, VMSI remains poised to continue the breakout move.
Volume: 310.072K Avg Volume: 390.14K
BUY POINT: $50.21 Volume=500K Target=$57.95 Stop=$48.68
POSITION: UMU IJ - Sept. $50c (52 delta) &/or Stock
http://www.investmenthouse.com/cs/vmsi.html
LEADER PLAYS:
Play Date: 05/23/2007
FCX (Freeport McMoran--$72.29; -1.46; optionable): Copper
http://biz.yahoo.com/p/f/fcx.html
EARNINGS: Announced 4-25-07
STATUS: Ascending base. Pulled back Thursday but very modest, tapping the 18 day EMA on the low (71.36) and the recovering to hold the 10 day EMA. That leaves it in the upper end of its base, still set to make the break higher. Very solid action in a very weak market on Thursday. To recap: FCX broke out from an 11 month base in late March and rallied on up to 72. Nice 12 stick run. It made it to the April and May 2006 highs and stalled. That slipped it into the current 6 week base as FCX makes some higher lows along the 18 day EMA. Looks as if it made its last one last Thursday, reversing off some selling on rising volume. Wednesday it was bouncing to a new closing high on this move on even better, much better, trade. Money flow is running higher ahead of price. Looking quite good here.
Volume: 11.075M Avg Volume: 11.939M
BUY POINT: $74.05 Volume=12M Target=$85.00 Stop=$71.11
POSITION: FCX HN - Aug. $70c (67 delta) or FCX KO - Nov. $75c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/fcx.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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