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PLAY >New Updates Thursday, March 01, 2001
New Split Updates   New Candidate Updates   New Momentum Updates
(We update our stop losses daily at the CURRENT PLAYS page.)

New Split Updates

LTR - Loews Corporation $107.35 -1.32 (+8.85)

Loews Corporation, a provider of insurance, cigarettes, watches, hotel operation services, and oil and gas drilling services, traded to a new 52-week high of $110.30 on Thursday. Unfortunately, the stock reversed directions following news that the U.S. Justice Department has filed an amended lawsuit against the tobacco industry designed to recover billions of dollars spent by the government on smoking-related illnesses. Shares of LTR ended the session at $107.35 with 460,000 shares changing hands. Hopefully, the stock will be able to bounce back, as we are now less than three weeks away from the 2:1 split, payable on March 20th. Until then, support has moved up to Tuesday's intra-day high of $106.90 with stronger support at $104.67, the 5-dma. Resistance has come in at Thursday's intra-day high of $110.30 and then $113.87, the 11/5/97 intra-day high. Consider opening new positions on a bounce off of $106.90 or a breakout above $110.30 on volume greater than 225,000 shares by noon. We are leaving our stops at $98.50 as downside protection.

Picked on February 27th @ $106.40
Change since picked +0.95
Stop Loss @ $98.50
Interactive Chart Quote News First Call on LTR

GVA - Granite Construction Inc. $33.40 +0.30 (0.33)

Granite Construction closed in the green thanks to a broad market rally Thursday afternoon. Like synchronized swimmers, the Dow Jones Industrial Average (INDU) and the NASDAQ Composite Index (COMPX) stopped their downward spiral and headed higher at 2:15 EST. Like many other stocks, GVA jumped on the bandwagon and headed north too. Recovering from an intra-day low of $32.41, GVA climbed about a $0.30 to close at $33.40. Thursday's volume was recorded at 82,000 shares, slightly higher than its three-month average of 65,000. GVA is currently sitting at resistance at $33.50. The next challenge will come when the stock attempts to conquer the 52-week high of $34.40. Support is underfoot at the 10-dma at $32.44 and then the 50-dma at $31.00. So, possible entry points for a play might include a bounce off support or a move through resistance on good volume, meaning better than 60,000 traded by midday. We have raised the volume limit because the stock is now so close to a new high we'd like to see strong volume when going to a new level. We will hold our stop loss in place at $30.50 just below support.

Picked on February 25th at $33.07
Change since picked +$0.33
Stop Loss at $30.50
Interactive Chart Quote News First Call on GVA

New Candidate Updates

AYE - Allegheny Energy Incorporated $47.34 -0.11 (-0.06)

A state-by-state restructuring program in the power supply market could position Allegheny as one of the largest independent power producers in the country. As you can imagine, this has attracted plenty of attention from analysts, many of whom rate the stock as a "Buy." On Wednesday, the latest firm to jump on board was Friedman, Billings, Ramsey & Company. The firm initiated coverage of the stock with the aforementioned rating and set a 12-month price target of $60. However, the announcement did little to lift shares of AYE in trading, as the stock trended lower in the session, shaving $0.11 off its total. Still, the bigger picture remains in tact, as the stock continues to form a tight consolidation pattern on diminished volume, without breaking the upward trendline. In addition, the Stochastic looks to be rounding out and may be on the verge of issuing a buy signal. For now, we'll wait to see if support holds at the $47 mark (recent top) and then at the 20-dma of $46.62. Resistance should come in at the all time high of $49. Low risk entry points may present themselves with a bounce off support on volume of at least 350,000 shares by mid-day or a move through resistance on similar mid-day volume. We'll continue to keep stops at $45.94 to guard against lower levels.

Picked on February 22nd @ $48.22
Change since picked -0.88
Stop Loss @ $45.94
Interactive Chart Quote News First Call on AYE

BJ - BJ's Wholesale Club $45.47 -0.04 (+0.77)

BJ will be a very quick play for us, as the company is slated to report its earnings next Tuesday before the market opens. Consequently, we will exit this position no later than Monday's closing print. We may see a quick rally in anticipation of a split announcement that could come in conjunction with the earnings release. As for today's trading, BJ remains in a decided up trend despite today's mild sell-off. The stock closed above the 10-DMA of $45.44. Those who wish to attempt to catch an earnings and split anticipation run can purchase the stock if it can stay above $45.44 over the next couple of days. A move into new high ground of $47.00, accompanied by midday volume over 400,000 shares tomorrow, could give momentum traders a good entry point. The MACD is curiously negative. However, this may be a non-factor during the very short duration of this play.

Picked on February 27th @ $46.49
Change since picked -1.02
Stop Loss @ $44.00
Interactive Chart Quote News First Call on BJ

IGT - International Game Technology $54.21 +0.21 (+0.52)

IGT held fast during some vigorous selling in the early going today. IGT has enjoyed a substantial rally since September. Despite this move, IGT is currently trading with a P/E of 25.21, which is a true value considering the company is expected to grow its earnings by 36.62% this year. IGT strong stock price is near levels that have previously resulted in a split announcement. This fact is probably another reason why current shareholders are reluctant to sell during the market's gyrations. If IGT can establish a new high above $55.50 with decent first hour trading volume over 200,000 shares. This scenario may create a good entry opportunity, especially if today's late market rally has any follow through tomorrow. Another possible entry point would present itself if IGT pulls back and bounces off trendline support of $53.00. Keep an eye on the MACD, which continues to reside in positive territory but has slowed its ascent. If this indicator issues a sell signal, we would hold off on adding new positions. On the plus side, the RSI is giving the stock a little room before it becomes overbought.

Picked on February 20th @ $53.52
Change since picked +0.69
Stop Loss @ $49.50
Interactive Chart Quote News First Call on IGT

PFGC - Performance Food Group Company $53.50 +0.50 (+3.38)

Performance Food Group Company has been trading higher despite a generally weak market. On Tuesday, shares of the food product manufacturer hit an intra-day high of $53.75 after trading as low as $51.50 early in the session. The stock continues to make higher highs coupled with higher lows and its upward trend remains strong. Unfortunately, the volume has been unimpressive so the stock may run into resistance in the near future unless the volume picks up. Going forward, support is currently at Wednesday's intra-day high of $53 with additional support at $51.44, the 5-dma. Resistance has moved up to the December 29th intra-day high of $55.13 and then the December 27th intra-day high of $56.75. Traders should be looking for a bounce off of $53 or a move above $55.13 on midday volume of at least 100,000 shares before starting new plays. Our stops remain at $47 to limit potential losses.

Picked on February 25th @ $50.13
Change since picked +3.38
Stop Loss @ $47.00
Interactive Chart Quote News First Call on PFGC

PII - Polaris Industries Inc. $46.25 -$0.55 (-2.56)

Polaris has been losing ground daily since hitting a new high this past Monday. PII was slapped with a downgrade from "Buy" to "Neutral" from the investment firm USB Piper Jaffray. This, coupled with a decidedly negative market, has wreaked havoc on the stock this week, which is down 10% from Monday's close. Thursday, the stock traded on better than twice its normal volume as more than 180,000 shares changed hands. PII is now just above former consolidation at $46.00. Resistance will be challenged at the 20-dma at $47.88. If you are looking at starting a new play, consider a bounce off support or a move through resistance on volume surpassing 100,000 traded by midday. We will keep our stop loss in place just above the 50-dma at $44.88.

Picked on February 13th at $46.70
Change since picked -0.55
Stop Loss at $44.88
Interactive Chart Quote News First Call on PII

New Momentum Updates

BDX - Becton, Dickinson and Co. $36.06 +0.08 (+0.86)

This play survived the Dow Industrials (INDU) morning swoon of just over 200 points. BDX, a major supplier of a wide variety of medical products and equipment, appears to be one of the few stocks that people are comfortable holding while market participants anxiously await the Fed's next move. BDX may have been further buoyed during today's wild swings due to a presentation the company gave concerning its future business prospects at the Lehman Brothers Healthcare Conference. Although we do not know exactly what was said, companies generally put a positive spin on future business prospects during these type of conferences in order to encourage investment in their stock. As for trading, BDX may be very close to completing a consolidation phase that followed the establishment of a new 52-week high of $39.25. We expect a quick rally to retest this high if BDX can trade to $37.00 on midday volume over 700,000 shares. Otherwise, we remain comfortable adding positions, as long as the stock stays above the $35.00 support. Further boosting our confidence is the fact that OBV and the Money Flow both appear poised to move to higher ground.

Picked on February 11th @ $37.03
Change since picked -0.97
Stop Loss @ $34.50
Interactive Chart Quote News First Call on BDX

BVF - Biovail Corporation $44.21 -1.94 (+0.04)

Biovail Corporation, a leading developer of controlled-release drugs, announced first quarter earnings on Thursday morning. Revenues for the quarter increased 54% to $99.8 million and pro forma earnings increased 128% to $40.4 million compared to the same quarter last year. The company also raised its revenue and earnings guidance for 2001 and 2002. Despite the positive guidance, the stock sold off on Thursday. Shares of BVF closed just above its intra-day low of $44.20 on volume of 1.27 million shares. However, BVF is not falling out of its recent $42-$46 trading range so not much has changed technically. For now, support is the February 23rd intra-day low of $43 with stronger support at the February 14th intra-day low of $42. Resistance has moved up to the Thursday's intra-day high of $46.50 and then the February 13th intra-day high of $47.35. Traders may consider entry points on a bounce off of $43 or a move above $46.15 on volume greater than 400,000 shares by noon. We are keeping our stops at $41.50 as downside protection.

Picked on February 12th @ $46.15
Change since picked -1.94
Stop Loss @ $41.50
Interactive Chart Quote News First Call on BVF

ELY - Callaway Golf Corporation $25.30 +1.25 (+1.31)

Callaway Golf drives for more gains on Thursday and scores a new 52-week high. More impressive was the fact that the breakout unfolded without the assistance of a news release. This is a good indication that momentum players are keeping a close watch on the stock and are buying on the breakouts. The intra-day chart confirms this possibility, as a large volume spike occurred just as ELY shares broke above the previous high ($25). What's more, we're impressed with good technical readings in both the MACD and OBV indicators, which support the present uptrend. All of these factors make the daily chart quite compelling and lead us to believe that a run to $30 is possible. On the other hand, should the stock retrace to lower levels before heading higher, expect to see support at the recent high of $25, and just below at the 5-dma of $24.40. Consider adding to positions if ELY bounces off support on volume exceeding 250,000 shares traded by mid-day or move through today's intra-day high of $25.41. We'll hold stops at $20 to protect our backside.

Picked on February 25th @ $23.99
Change since picked +1.31
Stop Loss @ $20.00
Interactive Chart Quote News First Call on ELY

LMT - Lockheed Martin Corp. $36.73 -0.62 (-0.22)

Aerospace contractor Lockheed Martin Corporation has lost some ground over the past two sessions. On Thursday, shares of LMT traded below its 20-dma to an intra-day low of $35.65. However, the stock bounced back late in the day to close at $36.73 on volume of 1.87 million shares. Hopefully, this is just a round of profit taking and LMT will be able to regain its momentum. From a technical standpoint, support has fallen to the 20-dma at $36.63 with additional support at Thursday's intra-day low $35.65. Resistance is the 5-dma at $37.42 and then Wednesday's intra-day high of $38.15. A bounce off of $36.63 or a breakout above $37.42 on midday volume of at least 800,000 shares may be possible entry points. We are leaving our stops at $35 to limit potential losses.

Picked on February 4th @ $36.40
Change since picked +0.33
Stop Loss @ $35.00
Interactive Chart Quote News First Call on LMT

TX - Texaco Inc $65.20 +1.10 (+2.15)

Texaco received merger approval from the European Union (EU)and could soon be the world's fourth largest oil company. On Thursday, Texaco moved closer to a merger with Chevron (CHV). Texaco and Chevron have been in merger talks for a while now. and although the deal is not set in stone, today's hurdle was a big one. The next step will be approval from U.S. antitrust authorities, which sources familiar with the situation said will take some time. Once the merger is complete, the combined firm would have an output of 2.7 million barrels of oil per day. The two firms have interests in more than 40,000 gasoline stations around the world. For us, the news brought this play back into profitable territory, barely. We are now looking to reap some further gains and would like to see the stock bounce off support at $64.50 or the 20-dma at $63.40. This, or a direct move through resistance at $65.65, might trigger an entry point for a new play on this stock. If you are considering such a move, look for volume to come in at better than 1 million shares traded by mid-day. Thursday's advance was achieved on volume of 1.6 million, just shy of the three-month average of 1.8 million. In the event that things run-a-muck, we will post our stop loss at $61.88.

Picked on February 18th at $64.90
Change since picked +$0.30
Stop Loss at $61.88
Interactive Chart Quote News First Call on TX

Play Updates Index


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