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New Plays
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  ACF
  ARO
  BVN
  ETM
  MOD
  NEWP

New Long Plays

None today.
 

New Short Plays

Advance Auto Parts - AAP - close: 39.41 chg: -1.18 stop: 41.31

Company Description:
Headquartered in Roanoke, Va., Advance Auto Parts is the second-largest retailer of automotive parts, batteries, accessories and maintenance items in the United States based on sales and store count. As of December 31, 2005, the company had 2,872 stores in 40 states, Puerto Rico and the Virgin Islands. The company serves both the do-it-yourself and professional installer markets. (source: company press release or website)

Why We Like It:
The auto parts stocks took a tumble today after word got out that Home Depot (HD) was experimenting with its own auto-parts section in some Florida stores. Investors were naturally concerned over big home improvement stores like HD suddenly becoming new competition. The reaction in AAP pushed the stock below support at its exponential 200-dma and the $40.00 mark on very strong volume, which is of course bearish! There was an intraday bounce in AAP so the best entry point might be to wait for the bounce to reach the $40.00-40.50 region and then wait for the bounce to fail. We are going to target a decline into the $36.00-35.50 range. We do not want to hold over the mid-May earnings report.

Picked on April 11 at $39.41
Change since picked: + 0.00
Earnings Date 05/17/06 (unconfirmed)
Average Daily Volume: 943 thousand

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Americredit - ACF - close: 30.16 chg: -0.25 stop: 30.65

Company Description:
AmeriCredit Corp. is a leading independent auto finance company. Using its branch network and strategic alliances with auto groups and banks, the Company purchases retail installment contracts entered into by auto dealers with consumers who are typically unable to obtain financing from traditional sources. AmeriCredit has approximately one million customers and $11 billion in managed auto receivables. The Company was founded in 1992 and is headquartered in Fort Worth, Texas. (source: company press release or website)

Why We Like It:
Currently ACF is still inside its five-month rising, bullish trend. However, the technical picture is suggesting that momentum is fading and the stock is in danger of a breakdown. Actually it looks like the stock is in the process of breaking through the bottom of its rising channel now (see chart). Shares have not broken technical support at the 50-dma in months so we're going to suggest a trigger under the 50-dma at 29.49. If we are triggered then we'll target a drop toward the 200-dma in the $26.75-26.00 range. However, please note that this is a short-term play. We only have a couple of weeks for ACF to hit our trigger and then reach our target as we do not want to hold over the April 24th earnings report. FYI: alternatively if ACF rallies past the $31.00 level traders might want to consider short-term bullish positions. Please note that short-interest is relatively high in ACF and that raises the level of risk for this play. The latest data puts short interest at 13% of its 127 million-share float.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/24/06 (confirmed)
Average Daily Volume: 1.2 million

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Aeropostale - ARO - close: 28.39 chg: -0.86 stop: 29.05

Company Description:
Aeropostale, Inc. is a mall-based, specialty retailer of casual apparel and accessories, principally targeting 11 to 18 year-old young women and men. The company provides customers with a focused selection of high-quality, active-oriented, fashion and fashion basic merchandise at compelling values. Aeropostale maintains control over its proprietary brands by designing, sourcing, marketing and selling all of its own merchandise. (source: company press release or website)

Why We Like It:
Shares of apparel retailer ARO have been stuck in a sideways trading range for over three months now. Currently the stock is sinking toward the bottom of its range and with the major averages showing weakness we could see a breakdown soon. We're going to set a trigger to short the stock at $27.69. This is under support in the $27.75-28.00 range. If triggered then we'll target a decline to the $24.00 level. In the meantime nimble traders who can jump in and jump out quickly might want to try and play any bounce from the $28.00 level and exit near $31, which is near the top of its trading range. Please note that shorting ARO might be riskier than you'd expect. The latest data puts short interest at 8.1% of its 50.3 million-share float. This provides an opportunity for a short-squeeze.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 03/09/06 (confirmed)
Average Daily Volume: 1.0 million

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Compania Min.Buen. - BVN - close: 24.44 chg: -1.51 stop: 26.31

Company Description:
Compania de Minas Buenaventura S.A.A. is Peru's largest, publicly traded precious metals company and a major holder of mining rights in Peru. The Company is engaged in the mining, processing, development and exploration of gold and silver and other metals via wholly owned mines, as well as through its participation in joint exploration projects. (source: company press release or website)

Why We Like It:
Gold futures are still trading near 25-year highs but the rally in gold stocks is fading. The technical picture for the XAU gold & silver index is turning bearish and the weekly chart for the XAU index currently has a bearish engulfing candlestick (reversal) pattern. Meanwhile shares of BVN apparently have already reversed course with yesterday's failed rally at the $28.00 level and its 200-dma. Assuming there aren't any unknown variables that would send gold skyrocketing higher (like a terrorist attack on U.S. soil or the U.S. striking Iran) we suspect that the current bearish reversal in BVN will continue lower. We are going to aim for the $21.00-20.00 range. Currently the P&F chart points to an $18 target. We do not want to hold over the April 27th (unconfirmed) earnings report. There doesn't appear to be any data available about BVN's short interest.

Picked on April 11 at $24.44
Change since picked: + 0.00
Earnings Date 04/27/06 (unconfirmed)
Average Daily Volume: 818 thousand

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Entercom - ETM - close: 27.69 chg: -1.09 stop: 28.51

Company Description:
Entercom is one of the nation's five largest radio broadcasters, operating in Boston, Seattle, Denver, Portland, Sacramento, Kansas City, Indianapolis, Milwaukee, New Orleans, Norfolk, Buffalo, Memphis, Providence, Greensboro, Greenville/Spartanburg, Rochester, Madison, Wichita, Wilkes Barre/Scranton, Gainesville-Ocala, and Longview/Kelso, WA. (source: company press release or website)

Why We Like It:
Radio stocks, with the exception of XMSR and SIRI, have been terrible performers over the last year. Most of the group looks ready to hit new relative lows. One such stock is ETM. Shares under performed today with a 3.7% loss and the stock is quickly headed toward significant support at the $27.50 level. We want to catch any breakdown under $27.50 so we're suggesting a trigger to short ETM at $27.45. If triggered we will target a decline into the $25.50-25.25 range, which was support back in late 2000. Currently the P&F chart for ETM points to a $20.00 target so more aggressive traders may want to aim lower. We do not want to hold over the May 8th earnings report. Please note that short interest is currently around 8.7% of its 32.6 million-share float.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/08/06 (confirmed)
Average Daily Volume: 346 thousand

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Modine Mfg. - MOD - close: 27.73 chg: -0.74 stop: 30.01

Company Description:
Founded in 1916, with projected fiscal 2006 revenues from continuing operations of approximately $1.6 billion, Modine specializes in thermal management systems and components, bringing highly engineered heating and cooling technology and solutions to diversified global markets. Modine products are used in light, medium and heavy-duty vehicles, HVAC (heating, ventilating, and air conditioning) equipment, industrial equipment, refrigeration systems, fuel cells, and electronics. Based in Racine, Wisconsin, the Company has more than 8,200 employees at 34 facilities in 15 countries worldwide. (source: company press release or website)

Why We Like It:
MOD's breakdown today could be another casualty to the news that Home Depot (HD) is trying its hand at selling auto parts in some of its Florida stores as a test. MOD was already weak given the big drop in January and the oversold bounce had stalled at the $30.00 level for the past couple of weeks. Now the MACD on the daily chart has produced a new sell signal and today's drop is a breakdown under support near $28.00 and its simple 50-dma. It also looks like a breakdown below its two-month rising channel. We are suggesting shorts with MOD under $28.00 and our target will be the $25.75-25.50 range. More aggressive traders may want to aim lower since the action over the past three months looks like a big bear flag pattern. We do not want to hold over the early May earnings report. More conservative traders might want to consider putting their stop near $29.00 instead of $30.00.

Picked on April 11 at $27.73
Change since picked: + 0.00
Earnings Date 05/03/06 (unconfirmed)
Average Daily Volume: 230 thousand

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Newport Corp. - NEWP - close: 17.72 chg: -0.33 stop: 18.55

Company Description:
Newport Corporation is a leading global supplier of advanced-technology products and systems to the scientific research, microelectronics, life and health sciences, aerospace and defense/security and general industrial markets. (source: company press release or website)

Why We Like It:
NEWP has produced a classic head-and-shoulders top pattern. The stock flirted with a breakdown at the neckline (support) today. Technically it did violate the neckline but we want to see more confirmation. We're suggesting a trigger to short the stock at $17.45, which is under today's low. If triggered we are going to target a decline into the $16.25-16.00 range. However, we do expect some support near the 100-dma (16.50). The H&S pattern is suggesting a target in the 15.20 region. If triggered this will be a short-term play. We do not want to hold over the April 26th earnings report. The latest data lists short interest at 5.2% of its 36.6 million-share float.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/06 (confirmed)
Average Daily Volume: 436 thousand
 

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