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TSO - $119.30 +2.34 - Tesoro

TSO has begun to regain ground lost post earnings and a move back over $120 would be another buy signal for those wishing to add to positions. TSO also announced it closed the acquisition of the Shell refinery in California for $1.76 billion including the acquisition of 278 retail stations previously owned by Shell. All the stations will remain Shell branded but supplied and owned by Tesoro according to the terms of the deal.

For initial commentary see April 29th newsletter.

2:1 Split: Record date May-14th, Pay date May 29th.

Earnings: May 3rd, $1.67 vs 61 cents in comparison qtr

Breakout target: $110 hit 10:AM on 4/23/07
Position: 2009 $120 LEAP Call ZGC-AD @ $16.68

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ATW $61.83 -5.46 - Atwood Oceanics

That was painful! Atwood missed estimates of $1.08 with earnings of $1.01 and the street punished them severely. Unanticipated downtime at three of their eight rigs affected drilling revenue and costs rose 7% during the quarter. After missing estimates by 7 cents it was completely overlooked that they more than doubled earnings for the same period in 2006. Profit for the same period in 2006 was only 50 cents. Revenue nearly doubled as well to $31.7M from 15.6M. I don't see the problem but somebody really hammered the stock. $58-$60 is strong support and that is where buyers appeared on Friday. Goldman Sachs came out on Wednesday saying this drop makes Atwood an attractive acquisition target.

Interesting article in Investors Business Daily regarding Atwood.

For initial commentary see April 29th newsletter.

Earnings: May 8th est $1.08, actual $1.01

Breakout trigger $60.50 hit 4/23/07
Position: 2009 $70 LEAP Call ZFJ-AN @ $6.50

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TS - $45.18 -2.34 - Tenaris ** Stopped $45.50 **

Tenaris hit our exit stop at 10:30 on Monday giving us a $1.95 loss on the play. TS fortunes turned against us rather suddenly on their earnings announcement after the bell last Friday.

For initial commentary see April 14th newsletter.

Earnings: May 4th 41 cents

No LEAPS

Position: Sept $50 Call TSW-IJ @ $3.80, exit $1.85, -1.95

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BHP - $52.34 +0.71 - BHP Billiton

BHP was all over the board this week as takeover speculation between BHP and Rio Tinto (RTP) hit the wires. The talk started when a Citigroup analyst suggested BHP could acquire RTP for as much as a 20% premium and it would still be a good deal. As the talk bounced back and forth both pro and con the stocks of both companies bounced as well. BHP ended the week with a small gain but with the trend still intact. BHP and RTP have not commented on the suggested merger and odds are good it will not happen. The BJP CEO is retiring this year and no successor has been named. It would be a tough task for a new hire to arrive on the scene just as a $154B market cap global company tried to acquire a $110B global company. On the plus side the two companies to share some assets and are involved in some joint operations. It may not be as unlikely as some think. RTP gained +$40 on the news but has since cooled.

No earnings date announced.

For initial commentary see March 17th newsletter.

Earnings schedule: No date announced.

Breakout target $43.50 hit March 12th

Position: JAN-09 $50 LEAP Call ZPK-AJ @ $6.00

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CCJ - $50.48 +.13 - Cameco

CCJ held its ground on no news just below the new high as the uranium futures contract got off to a rough start. The contract has not seen any volume and prices have been very erratic from $130 to $148 per pound for June delivery. That covered volume of only 74 contracts for the entire week of trading. That is a $4500 movement for the 250-pound contract. The bid/ask spread was as little as $3 per contract to as much as $10 throughout the week making trading the contract extremely risky. I believe once it settles down and there is daily volume those spreads will shrink considerably. Since the contract is cash settled based on a 3rd party spot price assessment at month end we may need to go through that process a couple times to understand how real market prices are translated back into the cash contract. I have not traded it yet but once we get the first settlement I plan on building a long position several months out and just sitting on it.

Worldwide there are 28 new reactors being built, 64 on the drawing boards and 158 in the proposal stages. If all were built it would be a 57% increase from the 435 reactors now in operation. In 2006 the world consumed 180 million pounds of uranium but produced only 100 million pounds. The rest came from Russian nuclear warheads being decommissioned. The supply from those warheads is dwindling and will be completely gone by 2015.

For initial commentary see March 10th newsletter.

Earnings: Apr-27th, -47% due to revenue timing

Breakout trigger: $37.50 Hit March 7th

Position: JAN-09 $40 LEAP Call ZBK-AH @ $7.80

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PTR - $129.23 +3.31 - Petrochina

PTR held its double digit gains from last week until Thursday's implosion but then rebounded +6.33 on Friday's news from China. The $130 high on Friday was a 4-month high. No other news and no change in play.

For initial commentary see March 10th newsletter.

Breakdown target:
$110 1/2 position - hit Mar-5th

Position: JAN-09 $120 LEAP Call ZJK-AD @ $10.70
Cost reduction 4/19 $10.70 -2.25 = $8.45

Cost reduction play:
Position: stopped @ $114 4/19
Short June $105 Put PTR-RA @ $3.40, exit $1.15. +2.25

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SNP - $100.00 +10.01 - Sinopec

Sinopec blasted off to close at a new historic high on the China investment news. There was no news for the week specifically related to Sinopec but the trend is firmly in place. Multiple levels of resistance were broken and short covering from those levels provided much of the gains. I was sorely tempted to close the play this weekend for a $10 (143%) gain but the demand picture is so strong I am going to let it ride. No change in play.

For initial commentary see March 3rd newsletter.

Breakdown target $82.50 hit on 2/27

Position: OCT $85 Call SNP-JQ @ $7.00

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CHK $34.30 -1.24 - Chesapeake Energy ** Stop loss $32.00 **

CHK tanked sharply on Wednesday after announcing a new offering of $1 billion in convertible notes. Any offering that converts to stock has the potential to dilute existing shareholders. CHK halted its slide on Thursday when support at $33.50 was reached. No other news and no change in play. Maintain the stop at $32.

For initial commentary see Dec-9th newsletter.

Earnings: May 4th, 87 cents vs est of 78 cents

Current recommendation: Hold

Position: 2009 $35 LEAP VEC-AG @ $5.30

Insurance put:
Oct $30 Put CHK-VF @ 90 cents. Profit stop $28

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MRO $107.39 +2.98 - Marathon Oil

MRO took a minor hit after being sued by the Kentucky AG for alleged price gouging in the days after Katrina and Rita. Marathon announced it was counter suing the AG and the state of Kentucky to have the badly worded law proclaimed unconstitutional. Marathon said it priced gasoline based at market rates with 25% of production offline in the gulf and multiple refineries out of commission. This suit did not prevent MRO from closing at a new all time high on Friday. No change in play.

For initial commentary see Nov-18th newsletter.

Earnings: May 1st, $2.04 vs est $1.93

2:1 Stock Split June 18th, record date May 23rd

Current recommendation: Buy at $85

Position 2009 $100 LEAP Call VXM-AT @ $12.60
Cost update: Expired March put +65 cents to $13.25

Insurance put: 2/18/07
Position: March $85 PUT MRO-OQ @ 65 cents. expired

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HES - $58.48 +0.30 - Hess Corporation
(Formerly (AHC))

Gong nowhere fast seems to be the HES game plan. No news, no movement and no risk it appears. No change in play.

For initial commentary see Nov-4th newsletter.

Earnings: Apr-25th, $1.17 vs $2.22

Current recommendation: Buy at $47

Position:
11/05/06 2009 $50 LEAP Call VHS-AJ @ $6.80
Cost adjustment put exit +1.60, cost = $8.40

Insurance Put: Triggered Jan-3rd @ $49
01/03/07 May $45 put HES-QI @ $2.60, exit 1/26 $1.00

Insurance Put: 2/26/07
MAY $50 PUT IGG-QJ @ $1.35, profit stop $46
May $55 Put IGG-QK @ 80 cents. Profit Target $51

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BTU - $50.53 +1.62 - Peabody Energy

BTU eased slowly over resistance at $50and closed at nine month high on Wednesday and nearly recovered to that level on Friday after profit taking on Thursday. There was no news of note and no change in play.

For initial commentary see Oct-22nd newsletter.

Earnings schedule: April 19th, -32% on special items

Current recommendation: Buy at $46.50

Position:
10/22/06 Jan-2009 $50 LEAP Call ZZT-AJ @ $8.70
02/05/07 March put stopped -$1.00, cost = $9.70

Insurance put: Triggered with drop through $39
01/03/07 March $35 Put BTU-OG at $1.15, stopped @ $42.50

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SLB $74.38 -.23 Schlumberger

No news and although SLB lost a little ground it is still holding near its historic high set in late April. No news and no change in play.

For initial commentary see Oct-14th newsletter

Earnings: April 20th, 96 cents vs est of 91 cents

Current recommendation: Buy at $60, stop at $55

LEAP Position:
1/2 9/11/06 @ $8.60
1/2 9/12/06 @ $8.00
Position: 2009 $70 LEAP Call VWY-AN @ $8.30
Cost update for expired Jan put +2.00 = $10.30

Insurance Put: 9/18
Position: Jan $50 Put SLB-MJ @ $2.00, expired

Insurance put:
Position: June $70 PUT SLB-RN @ $1.15

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SUN $74.45 -1.67 - Sunoco

SUN lost some ground after it said it was planning a 30 day overhaul of its 85,000 bpd refinery in Tulsa in June. SUN has declined about $4 over the last 3 weeks but the trend is still intact. No change in play.

For initial commentary see Oct-14th newsletter

Earnings: May 3rd, 70 cents vs 59 cents in comparison qtr

Current recommendation: Buy at $60, stop at $54

LEAP Position:
9/12/06 Position: 2009 $70 LEAP Call VUN-AN @ $13.50
Cost update expired Jan put +2.40 = $15.90

Insurance Put:
Position: Jan $55 Put SUN-MK @ $2.40, expired

Insurance put:
Position: June $70 PUT SUN-RN @ 85 cents.

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VLO $73.83 +0.48 - Valero Energy

Despite Cramer's call to sell Valero the refiner just keeps printing money and holding within a few cents of its historic high. There is definitely no weakness to be seen as they decide if they want to sell any other non-core assets. Valero said it was examining each property and deciding if it fit their core goal. That goal is "not to be the biggest refiner but the most valuable." I added an insurance put just in case we see some profit taking here.

Insurance put:
Buy June $70 PUT ZPY-RN currently $1.20 cents if VLO touches $72.

For initial commentary see Oct-14th newsletter

Earnings: April 24th $1.86 vs $1.32

Current recommendation: Buy at $65, stop at $57

LEAP Position:
9/24/06 Position: 2009 $60 LEAP Call VHB-AL @ $7.70
Cost update expired Jan put +2.25 = $9.95

Insurance Put:
Position: 9/25 Jan $45 Put VLO-MI @ $2.25, expired

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DO - $87.39 -1.17 - Diamond Offshore ** Stop $84.00 **

DO is holding within $2 of its high but the momentum has slowed. I raised the stop just in case it turns south. No news.

For initial commentary see Oct-14th newsletter

Earnings: Apr 26th, $1.64 vs $1.06

Current recommendation: Buy at $75, stop at $69

LEAP Position:
8/29/06 Position: 2009 $80 LEAP Call VCT-AP @ 14.20
Cost reduction: Oct $70 Put profit -3.15, cost now $11.05
Cost increase: Dec $60 put expired -2.40, cost now $13.45

Insurance Put:
10/08 Dec $60 Put DO-XL @ $2.40, expired

Position closed:
10/03 October $70 put DO-VN @ $1.65, exit @ $4.80, +3.15


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Non-Energy Positions
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ATI - $115.18 +6.59 - Allegheny Tech

This may turn into the perfect entry. We were triggered in the prior week on a breakdown to $110 and the rebound has already stretched for +$10 from that dip. We need to retest the historic high of $119 from late April and then a breakout would be nice. Notice how optimistic I am about ATI. Cramer continues to pound the table on ATI almost daily so there is plenty of retail buying. No news and no change in play.

For initial commentary see May-5th newsletter

Breakdown target $110.00 hit 04/30

Call spread:
LONG JAN-09 $110 LEAP Call OYG-AX @ $21.50
SHORT JAN-09 $140 LEAP Call ZKG-AH @ $9.50

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TOL - $28.17 -1.34 - Toll Brothers

Maybe I have this wrong. Toll is supposed to go up and Beazer is supposed to go down. Instead they are acting in reverse. Toll warned early in the week that conditions were still lousy but cancellations had improved to only 18% from the 32% in the prior quarter. Strong support at $27. No change in play

For initial commentary see Apr-21st newsletter

Earnings schedule: May 24th

Breakout target: $28.50 hit 4/16
Position: 2009 $35 LEAP OTY-AG @ $3.50

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BZH - $32.79 -.54 - Beazer Homes ** LEAP PUT **

Beazer is finally starting to weaken. Support at $32.50 appe4ars about to crack although the negative news from TOL and HOV had less impact on BZH than the other builders. There is a strong case of denial in progress but once $32.50 cracks I think we will see the rats deserting the sinking ship.

Beazer is being flooded with suits, some seeking class action status on charges it practiced predatory lending, filed illegal loan documents and manipulated its stock price. These types of suits appear whenever bad news appears about a company but in this case it looks grim.

For initial commentary see March-31st newsletter

Earnings: April 26th, -1.12 vs +2.35 in the comparison quarter.

Position: Jan-08 $25 PUT WZF-ME @ $3.10

No stop loss
 

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