Option Investor
Play Updates

In Play Updates and Reviews

HAVING TROUBLE PRINTING?
Printer friendly version

UPL $57.87 +1.54 - Ultra Petroleum *** Stop Loss $52 ***

No news on UPL but another new six week high on Friday. No complaints but gas prices are going to tumble if oil retreats.

Prior comments:

They have identified three more producing zones at their Pinedale field that could substantially increase production. They also expect to receive some further downsizing on well placement allowing them to drill 2-4 times as many wells. They also expect to receive permission from the State of Wyoming to drill during the winter months effectively giving them an extra quarter or more of production per year. Now, we just need winter to show with some teeth this year and deplete the 3 tcf of gas currently in storage.

Ultra Petroleum presentation

Breakdown target: $52.50 Hit 8/30

Position: Jan 2009 $60 LEAP Call OZH-AL @ $8.00

*********************

CHK $35.56 +0.61 Chesapeake Energy

CHK in the news last week with Connecticut Gov. Jodi Rell calling for an investigation into price fixing by Chesapeake for shutting down some gas production until prices rise. CHK CEO Aubrey McClendon fired a letter right back demanding an apology for slander. He explained how on a BTU basis gas should be selling for $13.33 per MCF today with oil at $82. Instead gas is trading at 45% of parity at $6 because of the aggressive drilling programs of CHK and others in the industry. Sic em Aubrey!

CHK was recently upgraded to 5 stars by Morningstar.

Link to Enercom presentation

Position: 2010 $35 LEAP Call WZY-AG @ $6.60 ** No Stop on LEAP **

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

************************

HP $34.54 +1.39 Helmerich & Payne *** Stop Loss $27.50 ***

Now over the 100-day average. No news other than a great looking chart. Over $36.50 would be a new high.

Enercom presentation here

Position: Jan 2009 $35 LEAP Call ZQA-AG @ $4.50

*************************

HERO $27.88 +.59 Hercules Offshore ** Stop Loss $24.00 **

No news and a little hiccup on Thursday but still a gain for the week. Maintain the stop at $24.

Enercom presentation

Position: 2008 April $30 Call HIQ-DF @ $3.00

*************************

GLBL $25.56 +0.85 Global Industries ** Stop Loss $18.50 **

No news but the rate of climb has accelerated. No complaints and no change in play.

Enercom presentation

Position: 2008 March $25 Call GQO-CE @ $3.30

********************

BHP - $72.53 +6.59 BHP Billiton ** Stop Loss $60.00 **

No specific news but BHP is mentioned positively in some article nearly every day. Another new high and miners are a strong bet in today's global market.

Breakdown target: $55 hit 8/15/07

Position: 2010 $70 LEAP Call LPH-AN @ $9.00

*******************

CCJ - $43.89 -.79 Cameco ** Stop Loss $30 **

CCJ consolidated after adding nearly $5 the week before. No news and no change in play.

Breakdown target: $35 Hit 8/16/07

Position: 2010 $50 LEAP Call LTA-AJ @ $7.20

****************************
Non-Energy Positions
****************************

IWM $80.96 +2.88 Russell 2000 iShares ** Stop Loss $76.00 **

What a blast off on the Fed announcement. Now we just need to hang on and hope the bulls find some traction.

Position: Jan $80 Call IOW-AB @ $4.25

**************************

RIMM - $93.18 +5.92 - Research in Motion

RIMM has gone vertical again and with new products coming out in October to compete with the iPhone it is only going to get better. Earnings this week. We are pretty close to full value on this play so I expect to exit soon. We need some of the excess premium to bleed from the $76 short calls as they move farther into the money and we will exit.

For initial commentary see the July 1st newsletter.

Earnings schedule: Sept 27th.

Breakdown trigger: $56.00 hit 6/25

Call spread pre-split:
Position: LONG 2009 $180 LEAP Call VHO-AP @ $32.60
Position: SHORT 2009 $230 LEAP Call VHO-AF @ $10.47

Call spread post-split:
Position: LONG (3) 2009 $60 LEAP Call VHO-AL @ $10.87
Position: SHORT (3) 2009 $76 LEAP Call VHO-AU @ $ 3.62

********************

BSC $117.32 +.13 - Bear Stearns *** Stop Loss $97 ***

Those were some ugly earnings down -88% but it is just possible they were not as bad as some feared. BSC is holding near its recent highs and next week would be the key. We need a trend to develop over $120 to maximize value here.

Breakdown target $100 hit 8/06/07

Position: 2010 $120 LEAP Call YBO-AD @ $25.60

*********************

CFC - $19.61 +.19 Countrywide Financial ** Stop Loss $15 **

Still chopping around the $20 level and no trend has yet emerged. We need some positive news on the mortgage sector to kick off the next chapter in this play.

Breakdown target $20.00 hit 8/15/07

Position: 2010 $30 LEAP Call YJD-AF @ $7.00
 

Leaps Trader Update Archives