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Begin Part 3 of 3

NJR (New Jersey Resources--$45.86; +0.66; no options): Gas utility. Splits 3:2 effective March 4.
http://biz.yahoo.com/p/n/njr.html
STATUS: NJR recently broke its downtrend from November (high 48.75), taking out the center of a small double bottom and its 50 day MVA (45.62) in the process. It has been somewhat erratic since that good move, pulling back but showing good price/volume action. Friday it tapped it 200 day MVA at its low of 45 and bounced back up, moving on very good volume of 37,600 (average 29,000). Looking for the move to sustain a bit here, with the recent high at 46.74. Targeting 50 but carefully watching the high.
PLAY: Aggressive momentum: Over 46. Stop: 44.50. Stock only.

CONTINUING CANDIDATES BEST PLAYS: STJ broke out.
1) RARE - Looking for the move
2) HB - Tight in the pennant
3) TGIC - Continues to show strength on a new breakout
4) TGH - Good pullback
5) THC - Back up at resistance but looking to fall again
6) RYL - Still waiting for the breakout
7) YUM - Trying to breakout
8) FLIR - Making the pullback

RARE (Rare Hospitality--$26.12; -0.18; optionable): Restaurants.
http://biz.yahoo.com/p/r/rare.html
BACKGROUND: Last announced a 3:2 split on 7-26-00 in conjunction with earnings. The stock price was 29.50. The annual shareholder meeting was on 5-14-01 at which time authorized shares were increased. The company has sufficient shares for a 2:1 split.
STATUS: RARE is in a cup with handle dating back to May (high 28.43; all-time high at from February at 32). It pulled steadily back in the handle to tap its 50 day MVA (24.58), bouncing back over its short-term MVA's (18 day at 25.67). It is holding over that support, showing consecutive dojis, Friday on very low volume of 97,500 (average 270,200). Looking for RARE to hold the 18 day, and make a break over the handle high at 27.05 (there is an intraday spike at 27.50 made just before the handle formation). Target: 32.
BUY POINT: Breakout: 27.15 on minimum volume of 400,000. Stop: 25.25. Aggressive: Over 26.22 on above average volume. Stop: 24.38 (7%).
POSITION: Stock and/or May $25 calls to buy (QRH EE - low open interest).

HB (Hillenbrand--$59.75; -0.11; optionable):
http://biz.yahoo.com/p/h/hb.html
BACKGROUND: Based upon our research it does not appear that HB has ever split its stock. The company has sufficient shares for a 2:1 split.
STATUS: Tightening up in a pennant pattern, Friday testing its 18 day MVA (59.06) at its low but pulling back up to close with a doji on increased, strong volume (214,300; average 136,600). Looking good, and with the high volume doji we are watching for a strong move out of the pattern. HB made a big breakout move at the beginning of this month, moving from a jagged cup with handle. We were looking at a possible formation of a pennant then, and the pattern has set up nicely. Target: 70.
BUY POINT: From here: Over 60.95 on continued strong volume. Stop: 56.78 (7%).
POSITION: Stock and/or June $55 calls to buy (HB FK - under 100 open interest).

TGIC (Triad Guaranty--$43.13; +0.88; optionable): Surety & Title Insurance.
http://biz.yahoo.com/p/t/tgic.html
BACKGROUND: Last announced a 2:1 split on 9-18-97 at a stock price of $28.25. The annual shareholder meeting was on 5-10-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: TGIC broke out of a cup with handle early this month, and after a muted move pulled into a new handle-type consolidation, from which it broke out the last two sessions of this week. TGIC showed very solid volume on Friday's move (108,900; average 40,500), but pulled well off of its intraday high of 43.78. Off of that pattern the stock could come back and test the recent highs, at 42. Still targeting 49 on this week's move.
BUY POINT: For new positions, after a hold of 42 on a lower volume dip, a move back over 43 on increased volume. Stop: 40.08 (7%).
POSITION: Stock.

TGH (Trigon Healthcare--$75.78; +0.06; optionable):
http://biz.yahoo.com/p/t/tgh.html
BACKGROUND: Based upon our research it does not appear that TGH has ever split its stock. The annual shareholder meeting was on 4-25-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: TGH made a nice breakout from a 3-month cup with handle in January, and after a good run has pulled back into another handle to its larger, 13-month cup with handle base (left-side high 81.50). TGH hit 79 before pulling back, and has been moving over the support of the 18 day (74.66), making a small move back up toward the end of this week. The stock hit our aggressive buy point Friday, but volume was down Friday (185,900; average 190,000) as TGH showed a doji. Still looking good, and we will look for a strong move from here, or perhaps after a dip back toward the 18 day. Our original target for positions taken last month was 84, although we looked at taking some money off the table when the stock was topping recently. If it can make a new breakout move, targeting 92.
BUY POINT: From here: Over 76.50 on volume of 200,000 or better. Stop: 71.50 (50 day at 71.88). Breakout is over the recent high at 79, with volume of 300,000. Stop: 73.56.
POSITION: Stock and/or July $70 calls to buy (TGH GO - under 100 open interest).

THC (Tenet Health Care--$61.76; -0.04; optionable):
http://biz.yahoo.com/p/t/thc.html
BACKGROUND: Last announced a stock split in September 1991 in the $45 range. No additional shares will be authorized at the annual shareholder meeting, but the company has sufficient shares for a 2:1 split.
STATUS: After making the big drop through the 50 day MVA (61.94) early in the week, THC bounced back and closed Friday just under that resistance. Although a solid bounce from the week's low at 58.90, volume dipped each day on the move up, and with the doji Friday was at 1.58 million (average 1.75 million). The 50 day is also right at a former long-term trendline of THC's, so we are looking for the bounce back to fail here. We were targeting the 200 day (56) on puts, and we certainly can get another drop back from this resistance after the weak move up, but will watch the recent low at 59 for support.
BUY POINT: For new or additional positions, a drop through 61 on increased volume.
POSITION: April $65 puts to buy (THC PM).

RYL (Ryland Group--$81.07; +0.37; optionable): Residential construction.
http://biz.yahoo.com/p/r/ryl.html
BACKGROUND: Based upon our research it does not appear that RYL has ever split its stock. The annual shareholder meeting was on 4-25-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: Still in an ascending wedge, and we were looking for a breakout after Thursday's strong move back up from the support in the pattern of the 18 day MVA (78.29). However, RYL again could not make the move, closing with a loose doji as volume remained strong (down to 598,300; average 383,700). So close, but it might need to test the 18 day again, and if the stock can hold that level and make another higher low, we will continue to look for a breakout. We have been riding position toward a target of 85, but on a strong move over the high (81.99), we will adjust the target to 90.
BUY POINT: New high: 82.09 on volume of 500,000. Stop: 76.34 (7%).
POSITION: Stock and/or July $75 calls to buy (RYL GO).

YUM (Tricon Global--$56.61; +1.56; optionable): Forecast to announce a split on 2-12-02 after the market closes in conjunction with earnings.
http://biz.yahoo.com/p/y/yum.html
BACKGROUND: Based upon our research it does not appear that YUM has ever split its stock. The annual shareholder meeting was on 5-17-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: Gapped down to the 18 day MVA (54.96), but pushed back up and nearly high the breakout point of its ascending wedge (formed since late January). Volume was up but at 800,600 (average 736,400), and we are still looking for a move over the high of 56.77, but we are very close to that level, so we will look at a move over 56. If we get a gap over the high, we will see if YUM comes back to test it before moving up, and that is when we can take new or additional positions. We have been targeting 62 on the buy on the move over 54, but on a strong move here out of the current pattern we will look at moving that up to 65.
BUY POINT: Over 56 on volume of a million, with stock and/or July $50 calls to buy (YUM GJ). Stop: 52.17 (7%).
POSITION: Stock and/or July $50 calls to buy (YUM GJ).

FLIR (Flir Sys--$50.99; -1.28; optionable):
http://biz.yahoo.com/p/f/flir.html
BACKGROUND: Based upon our research it does not appear that FLIR has ever split its stock. The annual shareholder meeting was on 7-24-01 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split.
STATUS: After some solid moves, it looked like FLIR was ready to test back after closing well off of its high Thursday on big volume. We were looking for a test of 50, and FLIR did come back Friday, tapping 50.51 at its low and moving on much lower volume (437,200; average 340,500). That is that price/volume action we like to see - big volume on the moves up, and lighter volume on the tests back. Still looking for a hold of 50 (10 day MVA is at 48.83, with former highs). The breakout Wednesday was from a ragged cup with a pennant handle. The target is 58.
BUY POINT: Watching for a test of 50, but will look at new or additional positions on a strong move back up from there over 51.50 on increased volume. Stop: 47.90 (7%).
POSITION: Stock and/or July $45 calls to buy (FFQ GI).

POST SPLITS BEST PLAYS: MGAM is also shaping up, and SONC broke out.
1) VAR - Holding and looking for another move

VAR (Varian Medical--$40.17; +0.02; optionable): Split 2:1 on 1-16-02.
http://biz.yahoo.com/p/v/var.html
STATUS: Has hit up to 40.75 twice recently (including Thursday) at its intraday high, but has pulled well off of that level to close both times. However, it is holding up, making a new closing high Thursday and then following up with a low volume doji Friday (164,900; average 352,800). Could be resting here, and this week's move was only the second bounce from the short-term MVA's (10 day at 39.46, 18 day at 38.88) after its breakout from its double bottom with handle. Riding current positions (taken on the breakout in late January) toward a target of 46, and still a buy on this move on a strong move up from here if it can hold onto 40. If the market pushes it back down, it is still a play on a hold of the 10 day and another bounce.
PLAY: From here on a hold of 40 (aggressive): A run back over 40.50 on above average volume, with stock and/or May $35 calls to buy (VAR EG). Stop: 37.29.

****

WATCHLISTS: Many of these have made such good moves lately we have put them here to look for the next entry point.

PRE-ANNOUNCEMENTS WATCHLIST: BMS, BRL, CTAS, DRI, MRBK, LSTR and IFIN.

DIAN ($67.00; +0.11): Did not get the announcement, but DIAN took off with earnings and news of a positive outlook. Broke out with a great move Thursday, and saw a wide range Friday, testing back to 64.50 before closing with a 'hanging man' doji. That name connotes a negative move, and we will look for DIAN to again test back toward the prior high at 65. If it can hold that level, we can look at additional positions on a strong move back up from there. Stock and/or May $60 calls to buy (UID EL).

EXPD ($51.15; -1.77): Made the big move down, not bothering to test back toward the 200 day (55) first. Volume remained strong on the selling (657,400; average 334,300), still targeting 46.

INVN ($39.40; +3.20): Forecast to announce a split on 2-28-02 with a special meeting to increase authorized shares. Going toward the forecast, and trying to hold up, although moving on very low volume. INVN moved back over the short-term MVA's (10 day at 38.63) Friday, moving on increased volume of 1.74 million (average 2.9 million). Nothing to get excited about just yet, but we will see if it can generate something toward the handle high at 46.20, looking initially at a move over the recent high of 42.64 on above average volume, with stock and/or July $35 calls to buy (FQQ GG).

STU ($88.85; +0.45): Continuing to research a possible date. Looked poised to move up after a volume spike Wednesday, but it has not been able to generate anything but a weak move since. Friday volume was 13,500 (average 14,900). The breakout is over 89, but that is very close to the current price, so we will look for volume 21,000 and a move over 89.15, with stock. Stop: 83.

AROW ($29.85; +0.30): Working on a date. AROW tested all the way down to 29 (50 day at 29.13) intraday, but surged back up to close with a gain, moving on much higher volume than we have seen of late, 11,600 (average 9,400). The ascending wedge is holding up well. The breakout move is 30.35 on volume of 12,700, with stock.

DRS ($39.51; +0.17): Moved back over the short-term MVA's (18 day at 38.50) Thursday but volume was low, and DRS could only manage a doji Friday, with volume sharply up (301,900; average 235,000). The handle high is still out there at 43, but the aggressive can look at a move over 40, but we need above average volume, with stock and/or June $35 calls to buy (DRS FG).

PRE SPLITS WATCHLIST:

BLL ($85.75; -1.68): Splits 2:1 effective February 25. Splits effective Monday, so we will see how it handles the recent success. With positions we are carefully watching for a drop back, which could be severe, as it has taken off on a very steep trendline. Looking at possible support for a consolidation at the 10 day MVA (83.72; 18 day at 81.21), and will carefully watch the action at those levels.

BSYS ($64.31; +1.23): Splits 2:1 effective 2-25-02. Made a weak bounce up in its small ascending wedge. Heading for the split Monday, we will see if the strength holds, and look for a move over the high (post split 33) with volume in the 800,000 range (average 560,000), with stock and/or June $30 calls to buy (check broker for symbols, delta, etc.).

ACS ($91.00; -0.61): Splits 2:1 effective 2-25-02. Splits Monday, and with Friday's doji ACS could try the 18 day MVA (94.33) again before moving down. Still targeting 88 (post-split 44), but watching the bounce carefully.

GILD ($66.49; -0.57): Splits 2:1 effective March 8. Holding the 50 day, and not showing much now as it works through its flat base. We have some time, so will see if it can hold. The recent high is 71.15, with the high at 73.67.

WERN ($24.96; +0.13): Splits 4:3 on or about March 15. Has dipped below the 50 day MVA (25.61), holding the recent low at 24.75. If it can hold we will see if it will give us a move back up toward the high (29.57).

CONTINUING CANDIDATES WATCHLIST: When splits are not announced, we will keep the best split prospects on the report rather than continue to carry all of them in case there is a an unexpected announcement. We will continue to monitor the stocks that are trimmed and add them again when we ascertain a revised split announcement date. These include BBY, BBBY, EDS, ETH, GOSHA, LLL, MI, PII and THQI.

APPB ($33.80; +1.17): Made a bounce after tapping a low of 31.80 Thursday, but it was on comparatively weaker volume (615,800; average 442,500). It tapped at the 10 day MVA at its high of 34.09, and that level is typically strong resistance after a severe drop. For current positions looking for the move to fail, and still targeting the 200 day MVA, at 31.13.

DHR ($69.29; +1.84): Nice move! DHR has made a solid jump the last two sessions, moving out of the small consolidation formed on the breakout from its December-January ascending wedge (which was the right side of a reverse head and shoulders). Targeting 72 (high is 69.81).

GNSS ($39.00; -0.27): Broke the 200 day MVA (41.06) Thursday, and hit our new, aggressive buy point Friday, but pulled back up a bit to show a doji. Volume remained high (6.3 million; average 3.22 million), so we will see how its test of the 200 day goes - we could see it move back over that level, but the key will be whether the move up has a lot of strength, and if it can hold over that level. With the aggressive positions we are still looking at a target of 35 on a drop back down.

JCI ($87.60; -0.40): Thursday JCI broke out of the nice lateral pattern over the 10 day MVA (85.70), and tried to continue up Friday, but retreated from 89.15 to close with a 'tombstone' doji on big volume (681,900; average 423,200). The pattern indicates a dip back, but we will look for it to hold the 10 day and continue its run toward the target of 100.

STJ ($81.13; +1.53; earnings 4/17): Broke out! STJ has made an excellent move back up from its 50 day MVA (76.70). Friday's move, which was on excellent volume of 1.2 million (average 624,400), could continue, but we need to be wary that STJ took out its year-old upper channel line on this move (80.25), and has typically not moved more than about $2 over the prior highs (this time 80) on its steady run up. Therefore, with short-term positions we can look for resistance around 82 and a possible signal to exit, while with long-term positions we can look for a move back to support.

POST SPLITS WATCHLIST:

CHBS ($28.00; +0.95): Split 3:2 December 13. Made the move down this week, taking a relief bounce after gapping down and touching a low of 26.35. Volume was weaker at 327,500 (average 427,500), and we are still targeting the 200 day, at 24.38.

CHS ($31.14; -1.21): Split 3:2 effective 1-22-02. Dipping back now, recovering from a low of 30.25 Friday, but closing below the 18 day MVA (31.34), but CHS could be due for a trip to the 50 day (28.57).

HTLD ($22.49; +0.68): Split 3:2 effective 2-20-02. Nice 50 day MVA (21.13) bounce at the end of this week, Friday pulling back to close from 22.90 but closing over the short-term MVA's (22.17). Volume was strong at 271,400 (average 186,000). The aggressive can try a play over 23 on continued strong volume, with stock and/or June $20 calls to buy (QHK FD - no open interest). The play over the high is 23.68.

MGAM ($27.28; -0.75): Split 3:2 on February 12. Holding the 18 day (26.86), pulling back a bit more Friday, moving on much lower volume (208,000; average 287,000). Looking decent, and the aggressive can play a rebound over 28.50 on above average volume, with stock and/or July $25 calls to buy (QMG GE - no open interest). The high is 30.81.

SONC ($26.69; +1.49): Split 3:2 effective 2-11-02. Got a big bounce off the 18 day MVA and 'shooting star' doji, and SONC broke out to a new high on big volume (446,800; average 190,000). It is over its long-term upper channel trendline, at 25.50, so we can still ride positions up toward 30, but a play from here is aggressive. Still a buy up to 27.30, with stock and/or June $25 calls to buy (ZFQ FE).

XRAY ($34.02; +0.22): Split 3:2 effective February 1. Made a nice bounce Wednesday, but has followed up with consecutive loose dojis. Not too bad, and we will see if it can hold here, or if it will need to go back to support at 33 (50 day at 32.88, short-term at 33.34).

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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