stock split, stock research

Begin Part 3 of 3

Continuing Candidates Best Plays (contd.)

RARE (Rare Hospitality--$26.33; -0.57; optionable):
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: Continues to set up. RARE challenged the handle high last week, but volume has been week and it has pulled into a consolidation over the short-term MVA's (18 day at 26.21). In a cup with handle going back to May (high 28.43; all-time high 32), and the current move started after the handle dipped back to test the 50 day MVA (25.10). Volume continues to be light (down to 106,800 today; average 263,000), but it is looking pretty good and if it can hold 26 on light volume, we continue to look for a breakout. Target: 32.
BUY POINT: 27.15 on volume of 400,000. Stop: 25.25.
POSITION: Stock and/or May $25 calls to buy (QRH EE - low open interest).

POST SPLITS BEST PLAYS:
1) BSYS - Wild day as it tests the breakout

BSYS (Bisys Group--$33.02; -0.45; optionable): Splits 2:1 effective 2-25-02.
http://biz.yahoo.com/p/b/bsys.html
STATUS: BSYS forged a break to a new high Monday, and reached up to 34.22 today but pulled back in a rather erratic day. It tapped back near its 10 day MVA (32.28) at its low, but managed to close at the recent highs. Volume spiked high at 1.5 million (average 561,600), which is not the low volume we would typically want on a breakout test. However, we will see if BSYS can hold 33, and if it can, we can continue to ride positions toward a target of 37, and look at new positions on a strong move as well.
PLAY: After showing it can hold at 33, a move over 33.50 on continued strong volume, with stock and/or June $30 calls to buy (BQY FF).

WATCHLISTS:

PRE-ANNOUNCEMENTS WATCHLIST: AROW, BMS, BRL, CTAS, DRI, GTK, IFIN, MRBK, PDCO and STU.

ACDO ($52.92; -1.13): Forecast to announce a split with earnings on 4-29-02. Tried to make a move out of its pennant, but there was no volume, and ACDO pulled back to its short-term MVA's (18 day at 52.45). It stopped just below the buy point on the last move, and we are looking for volume of 800,000 at a buy point of 54.80, with stock and/or May $50 calls to buy (DZU EJ).

BER ($56.41; +0.36): Researching a new announcement date. Has been erratic as it tries to move up in the right side of its cup. Today BER moved over its recent highs, but volume was very light at 97,900 (average 128,800). Looks like a pullback to the 10 or 18 day MVA's (54.89 and 54.08), and we will see if it sets up better.

EXPD ($59.10; -0.47): Has made quite a move back up (stopping out remaining put positions), taking out its 50 day (56.24) last week. It slowed today, pulling back a bit on lower volume, so we will see if it can consolidate to digest its gains and set up the next move.

DRS ($40.95; +0.95): Creeping up now, forming a cup-shaped handle to the larger cup pattern. Today volume kicked in (553,600; average 243,500) but DRS pulled back from the intraday high of 42.10. We could see another test of support (short-term MVA's at 39.18) as it moves up, and the break over the recent high is 43.20.

XL ($96.49; +0.91): Working on an announcement date, but are looking at a board meeting the first week in April. Trying to move up after pulling back from its strong breakout. A decent bounce today, and the aggressive can look at a move over 97.40 on increased volume (872,300 today; average 862,700), with stock and/or July $90 calls to buy (XL GR). The high is 98.48.

ESI ($44.86; -0.14): Working on a date. Not much of a move out of its pattern, as volume was week and the stock moved laterally the last couple of sessions. We will see if ESI can hold the 10 day at 43.50 (recent highs at 44), and look for a bounce back up that we can play.

SLM ($94.85; +0.04): Researching a new date, and looking at a board meeting that our research shows will be in early April. Tried to continue up, hitting 96.27, but pulling back for a 'tombstone' doji on strong volume (1.09 million; average 762,600). The pattern typically indicates a pullback, but on a hold of the recent highs at 94 (or the 10 day MVA, at 93.19), we will continue to look for a target of 105.

PRE SPLITS WATCHLIST:

GILD ($72.99; -1.41): Splits 2:1 effective March 8. After the great move, GILD started up again today, looking strong. However, it ran out of steam after hitting 75.80, and pulled back. We need to be prepared for GILD to pull back, but we will see if it can hold 71-72 and perhaps set up a last move going toward the split.

SMD ($22.90; -0.43): Split 3:2 effective 3-16-02. Dipped back through the support of the short-term MVA's (23.42; 50 day at 21.83). Could be just a quick test back, and we can still look at a move, with the aggressive looking at a move over 24, with stock. Recent consolidation high is 24.70.

PMI ($73.37; +0.76): Announced a 2:1 stock split, effective date to be determined. Has made a bounce, but not that convincing, as volume has been quite low (steady at 220,300 today; average 240,500). From here not a new buy, but still in a solid uptrend and we could see it set up again in its trend on a move back toward the 18 day MVA (71.13).

WLP ($115.77; +0.03): Announced a 2:1 split, effective March 15. Dropped hard Monday, triggering the put play we were looking at after the gap back through the 50 day (122.17), and subsequent dojis. Today it showed a 'shooting star' doji on big volume (1.48 million; average 55,800), so we could get a relief bounce here, so we are protecting profits.

DHI ($40.94; -0.83): Announced a 3:2 stock split, effective 4-10-02! Gave us a nice move into its announcement. It pulled back from its intraday high Monday and showed a doji today, so we will see if it tests the 40 level (10 day at 39.41) before continuing toward the target of 45.

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 BBBY, DIAN, EDS, GNSS, GOSHA, JCI, LLL, PII, RYL, STJ, TGH, and TGIC.

APPB ($36.51; -0.14): A remarkable move back up, and now could be ready to show a consolidation, and we will evaluate it for a play when it sets up.

BBY ($67.25; -2.59): Dropped back again today from the 50 day MVA (70.04), and still looking at a put target of 63.

DHR ($69.98; -1.82): Made another blast up Monday and hit the bounce target, pulling back today on higher volume than we would like (up sharply to 2.5 million; average 1.16 million). It is at the level of its recent highs, so we will see if it can hold; the 10 day is just below at 68.28.

ETH ($40.85; -1.15): Has made a nice little run, but after another surge Monday we got a pullback today, and on volume that makes us concerned for short-term positions (up to 418,900; average 203,400). Watching carefully for more of a retreat, with the 10 day below at 68.28.

FLIR ($57.40; -1.24): Solid bounce again Monday that hit over the target of 58. Still looking decent after the lower volume drop today, although it could again test the support on this move, the 10 day MVA (54.39).

HB ($57.93; -1.50): Was in a nice pennant, but these patterns can go either way. We did not get the breakout, as HB fell today, closing just above its 50 day MVA (57.73). We will see if it can hold; volume was not high on the selling (111,000; average 150,000).

IGT ($66.25; -3.84): Did not get the announcement, and although IGT tried to breakout Monday, there was no volume, and today it dropped back. The 50 day is below at 65, and we will see if it can hold.

INVN ($42.75; +1.80): INVN has been holding in a consolidation on low volume, and today started a move, jumping on big volume (2.95 million; average 2.83 million) and taking out the buy point. It did pull back from its intraday high of 44.32, but is looking pretty good. The high is at 47.09.

MI ($61.98; -0.22): Tried a move but it lacked volume, and although it got more today, the move up to 63 failed and MI dropped back to close. The pattern indicates a test back to the 61 range, so we will see.

THC ($58.84; +2.19): Hit down to the target of the 200 day MVA Monday, and promptly produced a strong bounce from that level. It closed well off of its high of 60.10, so for positions that were not exited we could see a bit of a dip and a chance to take profits.

YUM ($59.37; -0.43): Good breakout, but is showing topping signs shy of our target of 62. Today it dipped slightly on low volume, so it is trying to hold up. The action indicates a possible pullback, and YUM on this breakout took out its upper channel trendline, so we will be careful with positions on a drop back - moving stops up just below the highs in its former consolidation, at 56. If it can hold the 10 day MVA (58.18), we will look to continue to ride.

POST SPLITS WATCHLIST: Watching CHS, SONC, HTLD and VAR. CHBS continued down toward the target on strong volume ACS has flown, pulling back a bit today.

BLL ($43.89; -0.02): Split 2:1 effective February 25. Continues to hold just over its upper channel and 10 day MVA (42.85). Not looking like it wants to take off and run again just yet, but neither giving an indication of a hard fall. We are still being cautious with existing positions, knowing such a drop could come.

MGAM ($31.67; -1.60): Split 3:2 on February 12. Gapped up and pulled back on higher volume, so we are wary of a test back to the 30 level. If it can hold there, still looks good.

NJR ($31.15; +0.31): Split 3:2 effective March 4. Jumped again, gapping up and hitting 31.39, but pulled back and closed with a loose 'star' doji. The gap up and doji indicates a test back, with recent support at the 50 and 200 day MVA's (30.52 and 30.10).

XRAY ($34.00; -0.01): Split 3:2 effective February 1. The bounce from the 50 day could be over, as XRAY showed a loose 'hanging man' doji on increased volume. Having trouble as it moves over 34 (high is at 34.69).

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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