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SUN - $64.18 Sunoco Inc.

This play did not go as planned but I am adding it anyway. The play description was to buy the 2007 $65 leaps when they began trading on Monday post split. Unfortunately the market makers did not add a $65 strike for 2007 but $62.50 instead. I am sure some readers quickly jumped on the option of their choice and rode out the confusion for the rest of the week. I personally chose a Jan-06 $65 call. Since I am planning on exiting the positions in late September the low premium made since to me. Since the official trigger event did not occur I am adding it to the portfolio as of today using the Jan-06 $65 call.

Company Info

Sunoco, Inc. operates through its subsidiaries as a petroleum refiner and marketer, and chemicals manufacturer with interests in logistics and coke making. Sunoco's petroleum refining and marketing operations include the manufacturing and marketing of a range of petroleum products, including fuels, lubricants and some petrochemicals. Sunoco's chemical operations consist of the manufacturing, distribution and marketing of commodity and intermediate petrochemicals. The Company's operations are organized into five business segments: refining and supply, retail marketing, chemicals, logistics and coke.

Buy Jan-2006 $65 Call SUN-AM currently $5.30

Insurance Put: Sept $60 Put SUN-UL currently $1.05
Do NOT enter the put position unless SUN trades at $62.00

Entry @64.18 (8/08)

SWN - $55.80 Southwestern Energy ** Stop $52.00 **

SWN saw some extremely sharp profit taking on Friday that knocked it down from $57 to $52.75 before the rebound began. Fortunately that was enough to trigger our entry at $53.50. Even a blind squirrel finds an acorn once in a while. I am not using an insurance put here and placed the stop just under Friday's dip low.

Earnings:

SWN earnings grew +29% as reported on July-26th. Production rose +19%.

Company Info

Southwestern Energy Company is an integrated energy company primarily focused on natural gas. Through its wholly owned subsidiaries, the Company is engaged in natural gas and oil exploration and production business. It operates principally in three segments: exploration and production, natural gas distribution and marketing. The Company's exploration and production activities are concentrated in Arkansas, Texas, Louisiana, New Mexico and Oklahoma. It's wholly owned subsidiary, Arkansas Western Gas Company, referred to as Arkansas Western, operates integrated natural gas distribution systems in northern Arkansas. The Company provides marketing services in each of its core areas of operation through its gas-marketing subsidiary, Southwestern Energy Services Company.

2006 MARCH $60 CALL SWN-CL @ $6.30
(no leaps)

Entry (8/05) $53.50

 

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