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world stock market, us stock market
Begin part 3 of 3
THE PLAYS: The market is in full selling right now so not playing new downside at this juncture but instead looking for upside positions to move into if they can hold up as DJ30, SP500 test their January lows.
New Post-Split Plays:
Play Date: 03/08/2008
JBHT (JB Hunt Transportation--$28.60; +0.37; optionable): Trucking
http://biz.yahoo.com/p/j/jbht.html
EARNINGS: Announced 1-29-08
STATUS: Cup w/handle. Taking another look at JBHT because it continues to set up a good pattern despite the selling market and the continuing bad economic news that you would presume would set the transportation stocks on their rears and not too gently at that. Instead JBHT is using the selling in the market to form the handle to its 8 month base, holding above the 50 day EMA (28.22) on the Friday close. Just being patient to let it break higher and show us the buy point. A transportation stock that is solid despite US economic worries. That tells us something about just how bad the recession is and how far along we are in it. If these stocks break higher then the recession is likely not that deep.
Volume: 2.398M Avg Volume: 2.445M
BUY POINT: $29.65 Volume=3.5M Target=$35.55 Stop=$28.11
POSITION: JHQ EF - May $30c (47 delta) &/or Stock
http://www.investmenthouse.com/ci/jbht.html
Play Date: 03/08/2008
SDA (Sadia S.A.--$17.78; +0.48; optionable): Processed meat products in Brazil
http://biz.yahoo.com/p/s/sda.html
EARNINGS: Last week of April (not confirmed)
STATUS: Cup w/handle. While the market sold off the past week SDA continued work on the handle to its 17 week base, moving laterally over the 50 day EMA (17.17) on lower volume except for the upside sessions; on those days volume has spiked higher and above average. That shows us ongoing buying even as it consolidates laterally. Friday showed us a big spike. Looks ready to process us some nice gains to the upside.
Volume: 806.347K Avg Volume: 389.694K
BUY POINT: $18.64 Volume=450K Target=$22.38 Stop=$17.74
POSITION: SDA FW - June $17.50c (67 delta, low OI) &/or Stock
http://www.investmenthouse.com/cs/sda.html
New Leader Plays:
Play Date: 03/08/2008
FDP (Fresh Del Monte Produce--$34.23; +0.44; optionable): Food, beverages
http://biz.yahoo.com/p/f/fdp.html
EARNINGS: Announced 2-26-08
STATUS: Ascending triangle. Nice 4.5 month base has set up, making higher and higher lows up the 90 day MA (32), making a higher low last week at the 18 day EMA (33.50). There is a constant top at 36, and FDP is building pressure for the breakout from below with those higher and higher lows. Strong money flow broke out ahead of the stock and we are looking for FDP to follow it on up. Did well in the last recession and it is set up to do well here.
Volume: 417.3K Avg Volume: 660.358K
BUY POINT: $36.24 Volume=1M Target=$41.95 Stop=$33.98
POSITION: FDP FG - June 35c (60 delta) &/or Stock
http://www.investmenthouse.com/ci/fdp.html
Play Date: 03/08/2008
HOS (Hormbeck Offshore Services--$45.39; -0.45; optionable): Shipping
http://biz.yahoo.com/p/h/hos.html
EARNINGS: Announced 2-21-08
STATUS: Double bottom w/handle. A nice 17 week base has formed as part of a larger 7.5 month pattern. Used the 200 day SMA at 41 as support during January and February, forming the second bottom of the pattern. It surged off the 200 day SMA on the earnings, clearing to a new high. It came back to test in the market selling, but held near support at the 18 day EMA, tapping at that level on the Friday low (44.72). Nice low volume test is setting up the next break higher, and we are just waiting for that move to show itself and give us the buy. A top stock in terms of earnings growth and technical pattern. A shipping stock that is solid despite world economic worries. As with the trucking companies, that tells us something about just how bad the recession is and how far along we are in it. If these stocks break higher then the recession is likely not that deep.
Volume: 483.906K Avg Volume: 611.086K
BUY POINT: $46.88 Volume=800K Target=$53.95 Stop=$44.52
POSITION: HOS FI - June $45c (56 delta) &/or Stock
http://www.investmenthouse.com/cs/hos.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.
ADM: Forecast April
AMX: Forecast in June. Heading the wrong way for now.
ATW: Nothing from ATW to start March other than a dip on Friday.
BUCY: Forecast second week of March
BVN: No split announcement but continuing its move up the 10 day EMA.
CEDC: Forecast tentatively early May. Will need at least that amount of time to pull out of this selling.
CLF: Forecast second week of May
CPRT: Forecast first week of March. Well that was a gap. It is out of the picture.
EAC: Tentatively forecast mid-March
ECA: Nice test of the breakout
ESV: Researching date
FCX: Testing back with the commodities but holding support at the 90 day MA
JEC: Forecast third week of April
JOYG: Early March. Reported strong earnings but no split.
MA: Forecast late April
MM: Researching date. May give us a new buy this week as it holds the 18 day EMA, testing its strong run higher.
RIG: Forecast mid-May
TKC: Tentatively forecast mid-April. Not looking too impressive right now.
STLD: Late April
UPL: No announcement but holding up at near support as it tests its run.
VIVO: Researching date.
WFT: Tentatively forecast late April
NEW PRE-ANNOUNCEMENT PLAYS
Play Date: 03/08/2008
GGB (Gerdau--$30.92; -0.62; optionable): Steel and iron
http://biz.yahoo.com/p/g/ggb.html
EARNINGS: Announced 2-13-08
STATUS: Test breakout. As with many steel stocks GGB enjoyed a strong run in February, breaking to an all-time new high and running up to 34.25, clearing a 15 week double bottom along the way. It spent the past week testing that breakout, coming back to the 18 day EMA (31) Friday, showing a rising star doji at that point. That hold of near support is also above the highs in the base, a good point for new buys as it takes back off to the upside from those levels and resumes its new high run. Very solid and a top rated stock in terms of earnings grown and technical position.
Volume: 3.473M Avg Volume: 3.157M
BUY POINT: $32.88 Volume=4.8M Target=$39.45 Stop=$30.58
POSITION: GGB FF - June $30c (55 delta) &/or Stock
http://www.investmenthouse.com/ci/ggb.html
Play Date: 03/08/2008
WMS (Williams Industries--$38.71; +0.40; optionable): Gaming machines, video lottery terminals
http://biz.yahoo.com/p/w/wms.html
EARNINGS: Announced 2-6-08
STATUS: Breakout test. Earnings in early February broke WMS out of a 16 week ascending base, pushing WMS to a new high on strong volume. Solid move higher then the market selling. WMS did not tank, it used the selling come back in an orderly fashion, testing back to the late December and late January highs in the base. Volume started to pick up last week, but it was on the sessions WMS posted a gain. That shows buyers are accumulating the stock, and that has us on the ready for a strong break higher on continued solid volume as our buy point. And yet another stock with strong earnings growth rates to match its strong technical pattern.
Volume: 978.86K Avg Volume: 784.863K
BUY POINT: $39.31 Volume=1.1M Target=$46.95 Stop=$37.22
POSITION: WMS GH - July $40c (48 delta) &/or Stock
http://www.investmenthouse.com/ci/wms.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 03/07/2008
GILD (Gilead Sciences--$48.70; +0.89; optionable): Biotechnology
http://biz.yahoo.com/p/g/gild.html
EARNINGS: Announced 1-23-08
STATUS: Test breakout. Tapped at the 10 day EMA on the low and broke higher on rising trade. Could have entered on Friday but wanted to see what kind of downside Monday brings in the market. A big of testing won't hurt at all, but if it continues higher from Friday it is still a buy. To recap: GILD broke higher from a 7 week double bottom to start March, moving higher to end February and start this month on strong volume. It peaked out at 50 on Wednesday and faded, falling again Thursday but on much lower, below average volume. Nice breakout and we are going to let it make the test down near the 10 day EMA (47) and pick it up as it bounces off that level. A picture of strength in a weak market, and after this test of the break higher it will be a good buy as that gives the market time to recover.
Volume: 10.403M Avg Volume: 9.139M
BUY POINT: On a continued move higher (orig. Test 47 then $47.22 on the way back up) Volume=11M Target=$55.45 Stop=$46.78
POSITION: GDQ EW - May $47.50c (57 delta) &/or Stock
http://www.investmenthouse.com/ci/gild.html
Play Date: 03/07/2008
LSTR (Landstar System--$47.26; -0.40; optionable): Trucking
http://biz.yahoo.com/p/l/lstr.html
EARNINGS: 4-17-08
STATUS: Cup w/handle. Still working in the handle, holding over near support at the 18 day EMA (47.08). Nice tight doji Friday on a jump in volume back up to average. Being patient and waiting for the breakout move. To recap: LSTR is in trucking and trucking is forming up, a potential early economic indicator. LSTR is working on a 5 week handle over the 18 day EMA in its 10 month base. Strong volume on the rally up the right side of the pattern in January, then low volume during the lateral and lower handle move in February. Volume surged ot start the month, something of a 'get ready' shot. Just being patient as we wait for a breakout on volume that is shooting higher again when it does.
Volume: 794.824K Avg Volume: 775.876K
BUY POINT: $49.05 Volume=1M Target=$56.45 Stop=$46.78
POSITION: QRY GJ - July $50c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/lstr.html
Play Date: 03/07/2008
XTO (XTO Energy--$60.17; -0.66; optionable): Independent oil and gas
http://biz.yahoo.com/p/x/xto.html
EARNINGS: Announced 2-12-08
STATUS: Breakout test. Excellent action to end the week, gapping down Friday but tapping the 18 day EMA (59.26) on the low and rebounding for modest loss. Lower, below average volume as it continued its tetst from that initial breakout and run higher. Excellent set up for the next move upside. To recap: Made us some great money on its breakout run, and now it is making the test we wanted, coming back to the 10 day EMA (60.68), coming to rest there on the Thursday close on much lower, below average volume. Watching to see if XTO holds at this level and then makes the next break higher in its breakout run. This is the second test of the 10 day EMA after the breakout. When making powerful runs stocks tend to bounce 4 to 5 times off the 10 or 18 day EMA. XTO is one of the stocks that is in a bull market despite the market overall, and it is strong. That means it still has plenty of upside ahead of it.
Volume: 5.214M Avg Volume: 5.973M
BUY POINT: $61.88 Volume=6.2M Target=$70.95 Stop=$60.39
POSITION: XTO HL - Aug. $60c (62 delta) &/or Stock
http://www.investmenthouse.com/ci/xto.html
CONTINUING LEADER PLAYS:
Play Date: 03/05/2008
DRS (DRS Technologies--$56.79; -1.70; optionable): Aerospace/defense
http://biz.yahoo.com/p/d/drs.html
EARNINGS: Announced 2-8-08
STATUS: Cup w/handle. Glad we waited to see the outcome of that solid Thursday move that closed significantly off its high as Friday DRS faded back to test near support at the 10 day EMA (56.75). Lower trade after that stronger volume Thursday move. A good test in a week market, holding support and in position to make the move higher. To recap: Nice volume surge Wednesday as DRS headed toward the breakout from a nicely formed 13 week base formed to set the foundation for the next run higher. DRS hit a new high in December and needed to work off the froth. This base has done that and with money flow surging higher ahead of the price it looks as if DRS is ready to follow it higher. Nice. One of the sectors we note looks good.
Volume: 622.1K Avg Volume: 497.887K
BUY POINT: $58.08 Volume=700K Target=$66.85 Stop=$56.22
POSITION: DRS FK - June $55c (69 delta) &/or Stock
http://www.investmenthouse.com/cs/drs.html
Play Date: 03/07/2008
LIFC (Lifecell--$40.55; +0.32; optionable): Biotechnology
http://biz.yahoo.com/p/l/lifc.html
EARNINGS: Announced 2-27-08
STATUS: Test 50 day EMA. Very solid action to end the week, gapping lower on the weak market open Friday, holding the 18 day EMA on that move and then bouncing for a gain on a sharp jump in volume. Like the movement and just waiting for a break higher on that continued strong volume to give us the buy point. To recap: LIFC broke higher just ahead of and after its earnings, moving off the 200 day SMA at 37.25 on strong volume. It ran into the 90 day MA (41.52) on that recovery, and then started to work laterally in a tight range over the 50 day EMA (40.11). As it works laterally money flow is surging higher, showing continued buying as it consolidates. Looking for some strong volume as it makes the break higher from this test.
Volume: 793.197K Avg Volume: 607.284K
BUY POINT: $41.88 Volume=900K Target=$48.31 Stop=$39.89
POSITION: QKL FH - June $40c (58 delta) &/or Stock
http://www.investmenthouse.com/ci/lifc.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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