New Watch List Entries

F - Ford Motor Co

INTC - Intel Corp

VOD - Vodafone


Active Watch List Candidates

Currently none. See the new watch list candidates section.


Dropped Watch List Entries

I have removed CY as a watch list candidate.



New Watch List Candidates:


Ford Motor Co. - F - close: 12.93

Company Info

Ford is an American auto maker. The stock was not immune to the market's recent weakness. The stock pulled back from resistance near the $13.50 level. I suspect pullback in Ford will might end soon and it will see a rebound.

Nationwide the flow of vehicle sales for all automakers has been healthy at a 15.3 million unit annual pace. Actually it's been hovering in the 15.3 to 15.4 levels for the last four months. Ford has seen some very healthy year over year sales gains. The company said sales in January 2013 were up +22%. February showed a +9% gain. March was only +6%. Although the trend does seem to be slowing it is outpacing many of its peers.

I want investors to be ready in case Ford surprises Wall Street with a better than expected earnings report. The company reports on April 24th. Analysts are expecting a profit of 38 cents a share.

The plan is to wait for Ford to close above $13.60 a share. We'll buy calls the next morning with a stop loss at $12.40. Our long-term target is $16.50. You could certainly aim higher. Currently the Point & Figure chart is forecasting a $24.50 target.

FYI: shares of Ford will begin trading ex-dividend on May 1st. The stock is currently yielding 3.1%.

Breakout trigger: Wait for a close above $13.60, buy calls the next day
stop loss @ $12.40

BUY the 2014 Jan $15 call (F1418A15) current ask $0.45

- or -

BUY the 2015 Jan $15 call (F1517A15) current ask $1.09

Chart of F:

Originally listed on the Watch List: 04/20/13


Intel Corp. - INTC - close: 22.44

Company Info

The semiconductor sector index, the SOX, appears to have peaked in mid March. Yet INTC is bucking the trend. Shares of INTC have been underperforming their peers for several months but it looks like INTC has finally found a bottom. Investors have been buying the sell-offs and now shares have formed a bullish pattern of higher lows.

The company recently reported earnings that were in-line with analyst estimates. Honestly I am surprised that INTC did not sell-off given the drop in its gross margins and the significant pullback in PC sales in the first quarter. It would appear that the market has finally priced in all the bad news.

The stock has broken out past resistance near $22.00 and is currently testing technical resistance at its simple and exponential 200-dma(s). The stock does have a 2013 high near $23.00. I would like to see INTC breakout past this level before we initiate positions.

Wait for INTC to close above $23.10. We'll buy calls the next day with a stop loss at $21.40. Our long-term target is $26.50 but we may have to exit our 2014 calls before then.

Breakout trigger: Wait for a close above $23.10, buy calls the next day
stop loss @ $21.40

BUY the 2014 Jan $25 call (INTC1418A25) current ask $0.65

- or -

BUY the 2015 Jan $25 call (INTC1517A25) current ask $1.48

Chart of INTC:

Originally listed on the Watch List: 04/20/13


Vodafone Group - VOD - close: 29.59

Company Info

Large telecom stocks have been a bright spot for market bulls in recent weeks. Maybe it's the perception that these are big safe-haven plays. It might be due to their high yields. VOD currently has a dividend yield of 3.4%. Whatever the case VOD managed to ignore most of the market volatility this past week. Now the stock is testing major resistance near the $30.00 level. A breakout here would be very bullish.

I am suggesting we wait for VOD to close above $30.25 and then buy calls the next day. If triggered we'll use a stop loss at $28.45. Our long-term target is $36.00. Please note, we do not want to open positions if VOD happens to gap open higher above $31.00. What might make shares gap higher? The stock actually gaps open almost every morning as trading in the U.S. adjusts for trading back home in London. However, what I am concerned about is a large gap higher. There has been growing speculation that VOD is a takeover target. The latest rumor is suggesting that AT&T and Verizon might team up to buy VOD. If that happens, and VOD sees a big gap higher, we do not want to buy calls on that gap open. It would be great news if we're already in the trade.

Breakout trigger: Wait for a close above $30.25, buy calls the next day
stop loss @ $28.45

BUY the 2014 Jan $30 call (VOD1418A30) current ask $1.75

- or -

BUY the 2015 Jan $35 call (VOD1517A35) current ask $1.00

Chart of VOD:

Long-term Chart of VOD:

Originally listed on the Watch List: 04/20/13


Active Watch List Candidates:



Cypress Semiconductor - CY - close: 9.66

Comments:
04/20/13: Shares of CY collapsed this past week following the company's earnings report on April 18th. CY actually beat analysts' earnings estimates and their revenue expectations. This should have been a bullish report. Yet management's cautious Q2 guidance and the fact that CY's margins retreated significantly sparked a sharp sell-off in the stock price.

It is very unlikely that CY will meet our entry point requirement (a close above $12.00) any time soon so I am removing the stock as a watch list candidate.

Trade did not open.

04/20/13 removed CY as a watch list candidate.

Originally listed on the Watch List: 03/16/13