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Begin part 3 of 3
THE PLAYS:
Good movers: CCJ; EPIQ; GES; GME; KWK; MA; MICC; MRO; STLD; SU; SUN; TSO; VCLK; WNR
New Pre-Split Plays:
Play Date: 06/02/2007
GILD (Gilead Sciences--$83.00; +0.23; optionable): Biotechnology. Splits 2:1 on 6-25-07
http://biz.yahoo.com/p/g/gild.html
STATUS: Flying plateau. GILD continues to set up nicely in its 6 week lateral trading range that is working along the 18 day EMA (82.42), holding that near support on mostly low volume. Setting up nicely and showing some rising volume last week as GILD moved up off a test toward the 50 day EMA on an intraday low. Money flow remains strong, and with that volume starting up we are on watch this week for the breakout from this range.
Volume: 2.362M Avg Volume: 4.149M
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: 06/02/2007
WMS (Williams Industries--$43.16; +0.80; optionable): Gaming machines, video lottery. Splits 3:2 on 6-15-07
http://biz.yahoo.com/p/w/wms.html
STATUS: Ascending triangle. WMS is making a series of higher lows the past six weeks at the 90 day MA and the 50 day EMA, as it bumps up against a top just below 44. This is building pressure for the breakout from its larger 17 week ascending base. Volume has been very low the past two weeks as WMS bounced up to the breakout point. Need to see volume surge as it makes the break. Breakouts form these patterns can be very explosive.
Volume: 217.9K Avg Volume: 414.589K
BUY POINT: $43.68 Volume=450K Target=$49.95 Stop=$41.68
POSITION: WMS JH - Oct. $40c (69 delta) &/or Stock
http://www.investmenthouse.com/cs/wms.html
New Post-Split Plays:
Play Date: 06/02/2007
NUE (Nucor--$69.25; +1.71; optionable): Steel and iron
http://biz.yahoo.com/p/n/nue.html
STATUS: Ascending base breakout. Volume jumped to end last week as NUE made a run off a higher low in its 24 week base and started the breakout move. Volume was lower Friday, but it was still average and followed two solid above average sessions. Nice break in progress and ready to move in as it continues. It may show some weakness to start the week, and frankly that is all the better if it comes back near 68 and rebounds from there. Either way it looks solid as it breaks to a new high.
Volume: 3.316M Avg Volume: 3.564M
BUY POINT: $69.52 Volume=4.5M Target=$79.95 Stop=$66.68
POSITION: NUE JN - Oct. $70c (49 delta) &/or Stock
http://www.investmenthouse.com/cs/nue.html
Play Date: 06/02/2007
OPTN (Option Care--$15.12; +0.05; optionable): Home health care
http://biz.yahoo.com/p/o/optn.html
EARNINGS: Announced 5-8-07
STATUS: Breakout test. OPTN is moving laterally the past week in a tight range, testing the breakout two weeks back from a 4.5 month cup with handle base. That base was the tail end of a larger 2 year reverse head and shoulders accumulation pattern. Very nice test, refusing to give up its gains; a sign of strength. Nice quiet, low volume to end the week; the calm before the storm. Looking for strong volume to come back as OPTN makes its next break higher. That move will take it to a new high, and as this is the first test of that breakout, OPTN has plenty of upside left ahead of it.
Volume: 82.63K Avg Volume: 271.289K
BUY POINT: $15.32 Volume=365K Target=$18.38 Stop=$14.65
POSITION: UOC JC - Oct. $15c (59 delta, low OI) &/or Stock
http://www.investmenthouse.com/cs/optn.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.
ATK: Tentatively forecast for early August.
BA: Researching date. Lost a little ground Friday after a great week.
BHI: Testing the 18 day EMA. Bumping up at the breakout point. Looks very good.
BIDU: Forecast in June. Nice rally last week and on solid volume.
CELG: Tentatively forecast mid-June. Earnings 5-2-07. Still trying to find that bottom at the 50 day EMA, and that could give us a new buy point.
CHAP: Forecast 2nd week of July
CHE: Forecast mid-June
CHTT: Forecast third week of July
CLB: Earnings 4-23-07. Researching the date. Trying to hold the 18 day EMA and continue the breakout.
CNQ: Earnings were 5-3-07. Enjoying the ride higher.
COH: Forecast early August.
CTRP: Researching next date as no announcement with its strong earnings.
DVN: Forecast last week of June.
GVA: Researching date. Still working up the 10 day EMA, but up and down trade day to day.
HURN: Wildcard. Researching date.
MA: Researching the next date, but with moves such as these, who cares right now?
NOV: Earnings 4-27-07. Huge volume Friday as NOV broke to a new high.
OSK: Forecast last week of July, first week of August
PENN: Earnings 4-26-07. Very nice week with some upside volume on a move to a new high.
RIMM: Early June
TMO: Researching to pinpoint the date.
XTO: Tentatively set for early June.
VIP: Researching date. Hard to read Russian.
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 06/02/2007
ACL (Alcon, Inc.--$137.75; -0.31; optionable): Medical supplies
BACKGROUND: No splits in ACL's history
http://biz.yahoo.com/p/a/acl.html
EARNINGS: Announced 4-25-07
STATUS: Cup w/handle. A small 5 week pattern has formed over the 50 day EMA (134.73), using the 10 day EMA as support last week as it formed the handle. This short pattern is acting as the handle of a much larger 20 month cup with handle base. Good volume spikes mid-week and then a test back tot eh 10 day EMA to form the handle Friday. Looking for that volume so surge back up as ACL breaks higher.
Volume: 436.5K Avg Volume: 429.794K
BUY POINT: $140.15 Volume=645K Target=$157.95 Stop=$136.48
POSITION: ACL HH - Aug. $140c (45 delta)
http://www.investmenthouse.com/cs/acl.html
Play Date: 06/02/2007
SSYS (Stratasys--$48.02; -0.13; optionable): 3-D printing systems
BACKGROUND: Last announced a 3:2 split on 11-5-03 at $42.90
http://biz.yahoo.com/p/s/ssys.html
EARNINGS: Announced 4-26-07
STATUS: Flying plateau. SSYS is working in a 5 week lateral flat pattern after gapping higher in late May on its earnings report. It gapped higher in February as well, that move taking it out of a long 3.5 year base. Thus the February through April run is just getting things started after a long base has set up the next move. Positive accumulation in the lateral move is setting up the next break higher. Money flow is moving higher as well. Very solid leader ready to continue its breakout run. No real volume last week, so we want to see it ramp up as SSYS makes its move.
Volume: 45.983K Avg Volume: 140.977K
BUY POINT: $48.77 Volume=225K Target=$56.95 Stop=$46.65
POSITION: QQG II - Sept. $45c (68 delta) &/or Stock
http://www.investmenthouse.com/cs/ssys.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 05/31/2007
CHAP (Chaparral Steel Company--$74.19; +1.01; optionable): Steel and iron
BACKGROUND: Last announced a 2:1 split on 7-13-06 at $66.60.
http://biz.yahoo.com/p/c/chap.html
EARNINGS: Announced 3-20-07
STATUS: Flying plateau. Volume was up above average Friday as CHAP bumped at the breakout point to continue its run. Looks ripe to make the move as steel is looking strong. To recap: CHAP has moved laterally the past 5 weeks on the 18 day EMA (72.08), consolidating the 7 week run from its mid-March breakout from a 3 month ascending base. Very nice, mostly lower volume lateral test has set up the next move. Money flow is running higher ahead of price even during this consolidation, and we are looking for CHAP to strap up and start the next run.
Volume: 875.923K Avg Volume: 811.691K
BUY POINT: $74.45 Volume=1M Target=$85.95 Stop=$71.88
POSITION: ZHQ JO - Oct. $75c (48 delta) &/or Stock
http://www.investmenthouse.com/cs/chap.html
Play Date: 05/26/2007
CTRP (Ctrip.com International--$75.31; -1.10; optionable): Chinese travel services
http://biz.yahoo.com/p/c/ctrp.html
EARNINGS: Announced 5-16-07
STATUS: Breakout test. Nice test of the 18 day EMA and the breakout continues on low, below average volume. It is primed to resume the move, but of course it has to show it with some upside on some solid volume. To recap: Strong mid-May breakout from its 14 week cup with handle base. Solid break on strong volume, nice low volume test. Just have to be patient and let it show the volume once more as it moves back up.
Volume: 288.376K Avg Volume: 20.919M
BUY POINT: $76.55 Volume=425K Target=$89.95 Stop=$74.88
POSITION: QCT IO - Sept. $75c (61 delta) &/or Stock
http://www.investmenthouse.com/cs/ctrp.html
CONTINUING PRE-SPLIT PLAYS:
Play Date: 05/31/2007
BWLD (Buffalo Wild Wings--$86.01; +0.40; optionable): Restaurants. Splits 2:1 on 6-19-07
http://biz.yahoo.com/p/b/bwld.html
EARNINGS: Announced 5-1-07
STATUS: Test 10 day EMA. Light trade and a lateral move to end the week, holding at the 10 day EMA (84.87) as it tests its last run and sets the stage for the next. To recap: BWLD broke sharply higher to start May on its announcement and is now making the second test of the 10 day EMA after that breakout move. A strong stock will make 4 to 5 bounces up off the 10 or 18 day EMA as it runs higher from its breakout before it comes back toward the 50 day EMA to take a breather. Nice pair of dojis on the candlestick chart the past two sessions as BWLD tests the last strong bounce higher and sets up for the next.
Volume: 244.003K Avg Volume: 373.642K
BUY POINT: $86.25 Volume=550K Target=$99.85 Stop=$84.15
POSITION: BQU GP - July $80c (73 delta) or BQU IQ - Sept. $85c (53 delta) &/or Stock
http://www.investmenthouse.com/cs/bwld.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 05/31/2007
CERN (Cerner--$56.66; -0.15; optionable): Healthcare information services
http://biz.yahoo.com/p/c/cern.html
EARNINGS: Announced 4-19-07
STATUS: Breakout test. Low, below average volume Friday after that big Thursday volume spike. CERN finished the week at the 10 day EMA (56.46), still in prime position to hold and make the next strong break higher. To recap: CERN surged higher last week, breaking free from a short 6 week base that consolidated the early February breakout from a large 14 month reverse head and shoulders pattern. Big jump on the resumption of the breakout move and now a nice, easy, lower volume test of the 10 day EMA (56.41) that has set up the next move. Volume jumped back well above average Thursday, indicating it is ready to start the move again. Just want to see it log the move to the buy point and we move in.
Volume: 510.869K Avg Volume: 835.951K
BUY POINT: $57.65 Volume=1.2M Target=$66.95 Stop=$55.65
POSITION: CQN IY - Sept. $57.50c (50 delta, 256 OI) or CQN IK - Sept. $55c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/cern.html
Play Date: 05/31/2007
CMC (Commercial Metals--$35.80; +0.65; optionable): Steel and iron
http://biz.yahoo.com/p/c/cmc.html
EARNINGS: 3-20-07
STATUS: Test 50 day EMA. More steel and iron, and CMC was throwing its weight around to end the week with some strong volume gains. It is ready to clear the prior May high, and when it does that breaks the resistance and frees it for the next run in its breakout. To recap: CMC is testing the March breakout and run from its 15 week base. It has formed something of a short double bottom the past month as the 50 day EMA (33.12) ran up to catch it. Last week it tapped at that support and bounced right back, forming the right leg to the double bottom. Great volume Wednesday as it broke higher, and looking for more solid trade as it makes the next break to a new high. Still early in the breakout run and plenty of upside to go to work for us.
Volume: 1.446M Avg Volume: 1.374M
BUY POINT: New: Strong move over 35 (orig. $35.78) Volume=1.8M Target=$41.45 Stop=$34.08
POSITION: CMC IG - Sept. $35c (52 delta) &/or Stock
http://www.investmenthouse.com/cs/cmc.html
Play Date: 05/26/2007
SLB (Schlumberger--$78.19; +0.32; optionable): Oil and gas well logging services
http://biz.yahoo.com/p/s/slb.html
STATUS: Breakout test. SLB is holding the 18 day EMA (77.65), and that keeps it on top of its April peak. There was some distribution volume Thursday, but like how it held its ground Friday. Looking for some strong, above average volume as SLB breaks higher and through the buy point.
Volume: 8.221M Avg Volume: 9.04M
BUY POINT: $80.22 Volume=10M Target=$91.95 Stop=$78.11
POSITION: SLB HP - Aug. $80c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/slb.html
Play Date: 05/31/2007
TRMB (Trimble Navigation--$29.25; +0.06; optionable): High end positioning devices
http://biz.yahoo.com/p/t/trmb.html
EARNINGS: 5-3-07
STATUS: 50 day EMA test. Volume spiked well above average Friday as TRMB tapped the 50 day SMA on the low and rebounded, showing a nice, tight doji. That should be the final shakeout as the buyers moved back in and drove TRMB back up after the test. Nice. To recap: Taking another look at TRMB as it has set up a nice bounce higher to continue the breakout move. It broke sharply higher in early May after earnings, gapping out of a 13 week cup with handle base. Nice low volume test with a 'get ready' above average volume spike Tuesday as TRMB bounced off support. Strong money flow is holding up nicely as TRMB tests. Volume moved up to average Thursday; looking for stronger volume as it makes the break higher and moves back up through the buy point.
Volume: 1.132M Avg Volume: 550.823K
BUY POINT: $29.88 Volume=650K Target=$34.89 Stop=$28.69
POSITION: TUH HY - Aug. $27.50c (67 delta) &/or Stock
http://www.investmenthouse.com/cs/trmb.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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