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Begin part 3 of 3
THE PLAYS
New Pre-Announcement plays contained in that section.
Leader plays:
Play Date: 06/07/2008
MA (MasterCard--$295.73; -10.43; optionable): Payment servicing
http://biz.yahoo.com/p/m/ma.html
EARNINGS: Late July
STATUS: Test 18 day EMA. Gapped higher in late April on strong earnings, clearing a 5 month base. It tested in late May then gapped higher again. It is now in its second test of the big breakout, coming back to the 10 day EMA (297.24) last week on lower and lower volume. May come back a bit more, but it has a tendency to take off rapidly after hitting this near support. Strong money flow continues to lead higher even as MA makes this test back to near support. Looking for the end of the test to send it higher and then we move in.
Volume: 2.939M Avg Volume: 3.491M
BUY POINT: $297.39 Volume=4M Target=$339.95 Stop=$291.34
POSITION: MAL GA - July $300c (50 delta)
http://www.investmenthouse.com/ci/ma.html
Downside:
Play Date: 06/07/2008
AMX (America Movil--$55.14; -2.22; optionable): Latin American cell phone service
http://biz.yahoo.com/p/a/amx.html
EARNINGS: Third week of July
STATUS: Put. Gapped lower on earnings in late April. It held at 56 for over a month, attempting to mount a recovery through the end of May. There it stumbled back to 56. Friday it collapsed through that level on a sharp rise in above average volume. Money flow is in the toilet and swirling toward the drain. Looking for AMX to follow. A move to the target lands a 40%ish gain.
Volume: 10.638M Avg Volume: 7.399M
BUY POINT: $54.96 Volume=7.5M Target=$51.91 Stop=$55.38
POSITION: AMX TK - Aug. $55p (-49 delta)
http://www.investmenthouse.com/ci/amx.html
Play Date: 06/07/2008
CPB (Campbell Soup--$32.67; -0.73; optionable): Processed foods (soup for one)
http://biz.yahoo.com/p/c/cpb.html
EARNINGS: Announced 5-19-08
STATUS: Put. Earnings did not sit well on investors' stomachs and CPB collapsed through the 200 day SMA (34.50) in a massive drop to 33ish. It worked laterally for three weeks, holding that level where there was support from prior peaks and troughs. Friday that gave way and CPB broke through the bottom of the range on the strongest volume in 2 weeks. Money flow is leading lower and CPB looks primed to follow it. A move to the target lands a 40%ish gain.
Volume: 2.334M Avg Volume: 1.804M
BUY POINT: $32.55 Volume=2M Target=$31.00 Stop=$32.87
POSITION: CPB TZ - Aug. $32.50p (-35 delta)
http://www.investmenthouse.com/ci/cpb.html
Play Date: 06/07/2008
DIA (Diamonds Trust (DJ30 EFT)--$122.12; -3.99; optionable)
http://biz.yahoo.com/p/d/dia.html
STATUS: Head and shoulders. Volume has jumped on the downside moves this month and Friday was of course the big break lower that consummated DIA's 9 week head and shoulders top. Pretty strong break lower and worth chasing a few positions, preferably on an early bounce Monday that stalls out. That would be preferable to a sharp downside open; if we get another one of those we will wait for a bounce back. Quite a break lower, however, and that indicates there is more downside before any significant upside. A move to the target lands a 38%ish gain.
Volume: 24.017M Avg Volume: 14.019M
BUY POINT: $121.94 Volume=18M Target=$119.00 Stop=$122.44
POSITION: DAW SR - July $122p (-43 delta)
http://www.investmenthouse.com/ci/dia.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.
AAPL: Started higher Thursday off the test with rumors the new iPhone will be unveiled next week. Closed a bit lower Friday but still in excellent position
APD: Tentatively set for third week of July
BHI: Tentatively set for late July
CLB: A wildcard with no splits. Tentatively set for July
COP: Forecast July. Big rebound form a dead away drop.
CW: Tentatively set for third week of July
ETN: Researching date
GGB: Researching date. Starting to break higher once more
GILD: Researching date
HES: Forecast July
IBM: Solid lateral move over the 10 day EMA as IBM holds its gains
JEC: Mid-July
JOYG: Breaking higher once more
MICC: Forecast third week of July
MTRX: Forecast early July
PX: Late July
RS: Mid-July
SCHN: Researching date
TMO: Tentatively set for July
VMI: Mid-July
WDR: Researching date
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 06/07/2008
ATW (Atwood Oceanics--$104.37; -2.92; optionable): Offshore oil and gas drilling
http://biz.yahoo.com/p/a/atw.html
EARNINGS: Announced 5-8-08
STATUS: Ascending base. ATW has formed the current 7 week base using the 50 day EMA (102) as support. This follows the April breakout from a 14 week double bottom; nice base on base pattern to really weed out the sellers and set up a new move higher. It is coming off the latest low in the recent pattern, surging Thursday on strong volume. Friday it continued higher but reversed to close lower along with many energy stocks. Managed to hold the short term moving averages on the close and volume was lower. Looking for a hold here and a new break higher. That is the one we can buy into.
Volume: 624.338K Avg Volume: 588.814K
BUY POINT: $105.77 Volume=800K Target=$121.95 Stop=$103.65
POSITION: ATW IA - Sept. $105c (60 delta) &/or Stock
http://www.investmenthouse.com/ci/atw.html
Play Date: 06/07/2008
BVN (Compania De Minas--$69.82; +1.63; optionable): Gold mining
http://biz.yahoo.com/p/b/bvn.html
EARNINGS: Late July
STATUS: Cup. BVN is working through an 11 week cup base that is consolidating a strong September 2007 to March 2008 run. Needed a good rest after that run, and this base is doing that, using the 200 day SMA near 60 as support on the early May low then working its way higher from there. Showing excellent upside volume the past week on the upside sessions, an indication of ongoing accumulation. While gold itself looks to have set up a top, BVN shows no indication of that. If Friday was a change in character in the market then gold become more valuable and BVN is well-positioned to take advantage of the recovery.
Volume: 818.748K Avg Volume: 759.978K
BUY POINT: $70.52 Volume=1M Target=$84.75 Stop=$66.78
POSITION: BVN IN - Sept. $70c (56 delta) &/or Stock
http://www.investmenthouse.com/ci/bvn.html
Play Date: 06/07/2008
CLB (Core Labs--$137.62; -1.85; optionable): Well logging, well servicing services
http://biz.yahoo.com/p/c/clb.html
EARNINGS: Third week April
STATUS: Cup w/handle. Big run in 2007 needed a nice rest to set up a new foundation for the next move higher. The current 7.5 month base is doing just that, and CLB is working higher the past month, showing solid upside volume on its advances. Strong trade to end May followed by some lower volume as it moved laterally to start June. Tried to move higher Friday with a gap, but no volume and most energy ended up lower nonetheless. Still a solid pattern and still looking to play a breakout move after this very nice base.
Volume: 113.162K Avg Volume: 207.132K
BUY POINT: $141.11 Volume=315K Target=$162.45 Stop=$136.45
POSITION: CLB IH - Sept. $140c (54 delta, 99 OI) &/or Stock
http://www.investmenthouse.com/cs/clb.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 06/05/2008
APD (Air Products & Chemicals--$103.06; -2.97; optionable): Chemicals
http://biz.yahoo.com/p/a/apd.html
EARNINGS: Third week of July
STATUS: Double bottom with handle. Friday APD was back off the Thursday surge, giving up some ground on lower though still strong volume. Holding the April and May peaks on the close, and that leaves APD perched in an excellent position to make the break higher once more. Strong pattern, strong stock. To recap: Strong volume, strong price move as APD surges out of its 6 month base. Moving to a new all-time high with panache. Looking to take some positions as it continues the move and then adding to the position on a successful test.
Volume: 2.106M Avg Volume: 1.329M
BUY POINT: New: $104.88 (orig. $106.24) Volume=1.5M Target=$119.95 Stop=$101.65
POSITION: APD IA - Sept. $105c (59 delta) &/or Stock
http://www.investmenthouse.com/ci/apd.html
Play Date: 05/31/2008
MBT (Mobile Telesys--$85.16; -2.95; optionable): Russian wireless telecom
http://biz.yahoo.com/p/m/mbt.html
EARNINGS: Announced 5-20-08
STATUS: Cup with handle. Gave back the Thursday bounce but still holding above the 18 day EMA on the close. That leaves MBT in very good position to make a new attempt at the breakout. To recap: After an excellent run in 2007 that needed a consolidation, MBT has formed an excellent base this year. It rallied higher starting mid-May with its earnings, forming the right side of its 5 month base. The past week it has slid laterally, waiting for the 10 day EMA (85.78) to catch up with it as volume slipped as well. Nice, nice shakeout/consolidation of the May run, setting up the breakout and run toward the prior high at 105. Nice setup from an excellent stock.
Volume: 1.491M Avg Volume: 1.777M
BUY POINT: New: $88.32 (orig. $89.32) Volume=2.8M Target=$104.95 Stop=$85.66
POSITION: MBT IR - Sept. $90c (46 delta) &/or Stock
http://www.investmenthouse.com/ci/mbt.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 05/31/2008
BRCM (Broadcom--$27.37; -1.38; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/b/brcm.html
EARNINGS: Announced 4-22-08
STATUS: Trend reversal. Tested back to the 200 day SMA on the Friday close on lower, below average volume. Good place for a bounce. To recap: Looking at BRCM again as it has set up again after its late April gap higher on earnings, moving back over the 200 day SMA (27.44) Friday. The catalyst was MRVL in the same sector with its outlook for the future. Strong volume, solid move over a key level. BRCM has a nice range to run higher without resistance, and there is that gap lower from October that it will eventually fill. Cool. Ready to move in as BRCM clears the early May high.
Volume: 12.575M Avg Volume: 15.078M
BUY POINT: $28.88 Volume=20M Target=$37.22 Stop=$27.31
POSITION: RCQ HY - Aug. $27.50c (64 delta) &/or Stock
http://www.investmenthouse.com/ci/brcm.html
CONTINUING LEADER PLAYS:
Play Date: 06/05/2008
BMRN (Biomarin Pharmaceuticals--$38.21; -0.48; optionable): Biotechnology
http://biz.yahoo.com/p/b/bmrn.html
EARNINGS: Late July
STATUS: Double bottom w/handle. After a strong volume move higher Thursday BMRN took the day off Friday in the selling, easing back on low, below average volume. Very solid indication of the committed owners of the stock. Looking for the breakout. To recap: Taking another run at BMRN as sure enough, when it got back to the 50 day EMA (37.18) is jumped back up on rising, above average volume. Okay. Nice 16 week base, good action off the 50 day EMA. Looking to take some positions as it continues the move on solid trade, following its strong money flow.
Volume: 1.298M Avg Volume: 1.697M
BUY POINT: $39.31 Volume=2.6M Target=$47.31 Stop=$37.05
POSITION: NUR JH - Oct. $40c (51 delta) &/or Stock
http://www.investmenthouse.com/ci/bmrn.html
Play Date: 06/05/2008
MOS (Mosaic Company--$133.36; -1.06; optionable): Ag chemicals
http://biz.yahoo.com/p/m/mos.html
EARNINGS: Late July
STATUS: Double bottom. Surged higher Friday but in the afternoon pullback MOS gave back its move. Lighter trade so no harm done. Still solid and still looking for the break higher. Just being patient. To recap: Nice volume Tuesday on a solid upside move and again Thursday as MOS bounced from a Wednesday pullback. As with other ag stocks it has formed a 7 week base, using the 50 day EMA (121.53) as support. Nice break higher Thursday and looking to move in as it continues the move higher.
Volume: 5.351M Avg Volume: 6.65M
BUY POINT: $134.88 Volume=9M Target=$154.95 Stop=$129.05
POSITION: MTJ IG - Sept. $135c (52 delta) &/or Stock
http://www.investmenthouse.com/ci/mos.html
Play Date: 06/04/2008
NETL (Netlogic Microsystems--$38.10; -2.05; optionable): Semiconductors
http://biz.yahoo.com/p/n/netl.html
EARNINGS: Late July
STATUS: Cup w/handle breakout. Getting a test back after the strong Wednesday surge, and that is something we actually like to see as it is going to give us a better entry point after it tests, maybe back to the 10 day EMA (37.16), and then starts back up. Nice. To recap: Strong volume Wednesday as NETL broke higher, clearing the highs in its 9 month base. Excellent action from the consolidation of its strong 2005 to early 2006 run when it was a new issue. Big base the past three years (of which the current pattern is the tail end) has set up a solid foundation to breakout and run to a new all-time high once more.
Volume: 1.157M Avg Volume: 743.345K
BUY POINT: $38.72 Volume=1M Target=$45.95 Stop=$37.08
POSITION: LKT JH - Oct. $40c (58 delta) &/or Stock
http://www.investmenthouse.com/ci/netl.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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