Sabrient Divers – 02/10/2012
by Sabrient - February 10th, 2012 12:00 am
Top 5 Divers |
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| Stock | Rating | Analysis | ||
| ACXM | STRONGSELL | Projected value for Acxiom is diminishing and long term growth rates are declining — someone throw them a lifeline. | ||
| BAK | STRONGSELL | With projected value going down even more quickly than their recent historical earnings, Braskem is not looking good. | ||
| CB | STRONGSELL | Analysts are lowering long-term growth expectations for Chubb, and showing agreement about short-term earnings declines as well. | ||
| CTRN | STRONGSELL | With projected value going down even more quickly than their recent historical earnings, Citi Trends is not looking good. | ||
| EOC | SELL | Projected value for ENDESA is diminishing and long term growth rates are declining — someone throw them a lifeline. | ||
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DiggAppetite For Diamond Foods Options Rises As Shares Tumble
by Option Review - February 9th, 2012 1:55 pm
Today’s tickers: DMND, MHS & TRIP
DMND - Diamond Foods, Inc. – Investors sent shares in the maker of Pop Secret and Emerald snack nuts sharply lower on Thursday after the Company said it will replace its top two executives and restate earnings for the past two years. The already hard-hit stock opened down more than 40.0% this morning to touch an intraday- and multi-year low of $21.44. Options on Diamond Foods attracted all kinds today, with some strategists nibbling at calls and selling puts, while others position for further downside in the name. Investors expecting shares to somewhat recover in the next six trading sessions picked up call options in the front month. Approximately 1,400 calls were purchased at the Feb. $25 strike for an average premium of $0.86 each. Call buyers may profit at expiration next Friday in the event that DMND’s shares rally 11.2% off the current price of $23.25 to top the average breakeven price of $25.86. Meanwhile, out-of-the-money put selling in the front month may mean some traders expect the stock is unlikely to tumble much further from here within the next week. Put sellers looked to the Feb. $20 strike, selling around 1,500 of the contracts to receive an average premium of $0.64 per contract. Traders keep the full amount of premium as long as shares in Diamond Foods exceed $20.00 through expiration. Options volume on the food products company today currently exceeds 95,000 contracts, an active day for the stock, which has 158,981 contracts comprising overall open interest.
MHS - Medco Health Solutions, Inc. – Shares in the pharmacy-benefits-manager (PBM) are off slightly this morning, down 0.20% at $60.70 as of 11:30 a.m. in New York, but options activity in the name suggests the stock…
BOEasy Money Thursday – Greasing the Wheels
by Phil - February 9th, 2012 8:27 am
More free money!
That's the way we like to start the day as the BOE pumps another $75Bn into the mix and, best of all, their currency went UP on the news because "whisper numbers were for $100Bn." Now that we know the magic formula, we can start a rumor that the Fed will print $3Tn and then, when they ONLY print $2.5Tn – the Dollar will become much more valuable. See, I'm starting to think like a Central Banker!
Also in the "bad news must be good news" pile as Greek Finance Minister Evangelos Venizelos (wouldn't it suck to live in Greece with a name like Bob Smith?) heads to Brussels with NO DEAL. That's right there is still no deal on the Greek bailout that has boosted the markets by 22% since October. They do claim that the only remaining issue is pension cuts but all the Florida voters who picked Romney will soon find out how easy that is to accomplish.
Just last February, I was writing a Thursday post titled "Greece is the Word" where I warned that the 4.23% CDS rate hitting Greek bonds was unsustainable and that turned us bearish right at the top of the rally at S&P 1,344. Yesterday, the S&P was back to 1,349 and I wonder if Greece never happened – would I have continued to be bullish with the markets at this level?
On the whole, even WITH the snowballing Greek crisis, we "only" fell to 1,249 in March so, with Greece all fixed – maybe we can afford to be a bit more bullish. I'll be more comfortable with the upside once we see that Greece is not a "sell on the news" event but, as I noted yesterday, our last 10 bullish picks did quite well and a few of them are still playable and certainly there are still opportunities out there to pick up good stocks fairly cheaply.
Take DMND, for example. Last night, the stock fell from $37 to $20.50 as the beleaguered company will have to restate their last two years of earnings and that sent the CEO and two CFO's out the door and does, in fact, constitute a "material adverse change" that will allow PG to, at their discretion, terminate their deal to merge their Pringles division into DMND in exchange for a…
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Sector Detector: Quack, quack…ducks are lining up for the bulls
by Sabrient - February 9th, 2012 1:31 am
Courtesy of Scott Martindale, Sabrient Systems and Gradient Analytics
The stock market is behaving extremely well from a technical perspective. And why not? The world seems stable enough to give investors the confidence to maintain a “risk-on” allocation. Sure, there is still plenty to worry about. But more and more, investors are growing bolder. The Dow is at its highest level since 2008 and wants to challenge 13,000. The Nasdaq is at its highest level since 2000.
All the central banks are joining forces to keep debt-laden countries solvent and prevent Europe (and by extension, the planet) from falling back into recession. And in this election year, the Obama administration is ensuring that all efforts are focused on supporting the economy and creating an environment conducive to job growth. History shows that re-election is nearly impossible otherwise. Although the longer-term impact of all this fiat liquidity flooding the globe is uncertain, for now it is doing its job well.
What else? Well, consumers are spending again, which is fueling expansion in the manufacturing sector. Even GM is back on top as the best-selling automaker. And then there’s the resurgent IPO market, with last week’s Facebook filing getting investors all atwitter (pun intended). In fact, things are going so well that even our less-than-loveable TSA is lightening up a bit and introducing a “Trusted Traveler” program to greatly shorten the screening process for frequent fliers. Yes, life is good…or at least it’s improving.
Among the 10 U.S. sector iShares, Financial (IYF), Energy (IYE) and Technology (IYW) have been leaders lately. And as I’ll discuss shortly, the Sabrient SectorCast ETF rankings continue to display an increasingly bullish bias.
As usual, the main worry has to do with Greece. Last I heard on Wednesday night as I write this is that a deal is almost done. The severity of the reforms and austerity program has been tough for all members of the coalition government to swallow, but they have little bargaining power given Greece’s desperate need for rescue funds and a bond swap. Optimistic bulls seem to be expecting (or hoping for) a deal to happen imminently.
Looking at the SPY chart, the market is still consolidating in place while working off its overbought technicals, but it there is no denying that it is behaving extremely well. Morning weakness is invariably met with buyers during the day, leading to a…
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Sabrient Risers – 2/9/2012
by Sabrient - February 9th, 2012 12:00 am
Top 5 Risers |
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| Stock | Rating | Analysis | ||
| X | BUY | The projected value for US Steel is still rising quickly even though past earnings have already improved significantly. | ||
| CMI | STRONGBUY | Many analysts are expecting higher than previously expected long term growth from Cummins, and its near-term earnings outlook is also improving. | ||
| CAI | BUY | CACI is one of the top candidates projected to achieve both higher than previously projected earnings in the short run and a higher earnings growth rate in the long run. | ||
| ASBC | BUY | Many analysts are expecting higher than previously expected long term growth from Associated Bancorp, and its near-term earnings outlook is also improving. | ||
| RDWR | BUY | Radware has been gaining recognition from analysts as a good canditate for achieving higher than expected earnings along with higher overall projected valuation. | ||
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Sabrient Divers – 02/09/2012
by Sabrient - February 9th, 2012 12:00 am
Top 5 Divers |
||||
| Stock | Rating | Analysis | ||
| ACXM | STRONGSELL | Projected value for Acxiom is diminishing and long term growth rates are declining — someone throw them a lifeline. | ||
| CTRN | STRONGSELL | We project an unfortunate decrease in value for Citi Trends, and we’re not alone in this opinion as other analysts are also reducing expectations. | ||
| BAK | STRONGSELL | With projected value going down even more quickly than their recent historical earnings, Braskem is not looking good. | ||
| CB | STRONGSELL | Analysts are lowering long-term growth expectations for Chubb, and showing agreement about short-term earnings declines as well. | ||
| EOC | SELL | Projected value for ENDESA is diminishing and long term growth rates are declining — someone throw them a lifeline. | ||
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
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coordinator for PSW. She manages the Favorites backup site
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