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New Plays
Long Plays
Short Plays
ARA AIV
BTI CPT
BUD  
GGC  
MGRC  

New Long Plays

Aracruz Celulose - ARA - close: 56.29 chg: +0.89 stop: 53.95

Company Description:
Aracruz Celulose S.A., with operations in the Brazilian states of Esprito Santo, Bahia, Minas Gerais and Rio Grande do Sul, is the world's largest producer of bleached eucalyptus kraft pulp. All of the high-quality hardwood pulp supplied by the company is produced exclusively from planted eucalyptus forests. The Aracruz pulp is used to manufacture a wide range of consumer and value-added products, including premium tissue and top quality printing and specialty papers. (source: company press release or website)

Why We Like It:
It appears that the three-week consolidation, and potential bull flag, in shares of ARA are ending. Traders continue to buy the bounce from the stock's recent test of support near $54 and its 50-dma. Technical indicators are turning positive and the P&F chart is also showing a bounce from support although the P&F chart remains negative for now. Friday's rally was a breakout over the 10 and 100-dma, which looks like a new entry point to us. We're suggesting long positions with ARA above $56.00. The stock does have resistance in the $58.50-59.00 zone but ARA appears to be building an inverse head-and-shoulders pattern so our target is the $62.00-62.50 range.

Picked on May 06 at $56.29
Change since picked: + 0.00
Earnings Date 04/09/07 (confirmed)
Average Daily Volume: 383 thousand

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British Amer. Tob. - BTI - cls: 63.62 chg: +0.77 stop: 61.45

Company Description:
Ours is the world's most international tobacco group, with brands sold in 180 markets around the world. We make high quality tobacco products for the diverse preferences of millions of consumers, span the business from seed to smoke and are committed to embedding the principles of corporate social responsibility Group-wide. (source: company press release or website)

Why We Like It:
If you read the news shares of BTI were up on Friday because it might get out bid on a plan to buy a European rival. We like it because shares have a very consistent bullish trend and look ready to breakout over resistance at $64.00. The improving technical picture doesn't hurt either. Nimble traders may want to consider trying to buy a dip in the $62-63 range. We are suggesting a trigger at $64.05 to catch a breakout above resistance. If triggered our target is the $67.50-70.00 range. BTI doesn't move very fast so this could take several weeks.

Picked on May xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/27/07 (unconfirmed)
Average Daily Volume: 105 thousand

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Anheuser Busch - BUD - cls: 50.50 chg: +0.20 stop: 48.95

Company Description:
Based in St. Louis, Anheuser-Busch is the leading American brewer, holding a 48.4 percent share of U.S. beer sales. The company brews the world's largest-selling beers, Budweiser and Bud Light. Anheuser-Busch also owns a 50 percent share in Grupo Modelo, Mexico's leading brewer, and a 27 percent share in China brewer Tsingtao, whose namesake beer brand is the country's best-selling premium beer. (source: company press release or website)

Why We Like It:
BUD got squashed back in late April after missing earnings estimates by two cents. Yet traders were quick to buy the dip near its 200-dma and near the bottom of its long-term rising channel (see chart). It might seem like we're late to jump in after a four-day bounce. However, we're only talking about a $1.30 move in the last few sessions. If BUD gives us a dip, we'll take it but we're not going to wait for one. Patient traders may want to wait since BUD might pull back when it hits the 10-dma and 50-dma directly overhead. The stock doesn't move very fast so it could take several weeks before shares hit our target in the $53.85-54.00 range.

Picked on May 06 at $50.50
Change since picked: + 0.00
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume: 3.1 million

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Georgia Gulf - GGC - close: 17.09 chg: +0.42 stop: 15.99

Company Description:
Georgia Gulf Corporation is a leading, integrated North American manufacturer of two chemical lines, chlorovinyls and aromatics, and manufactures vinyl-based building and home improvement products. The Company's vinyl-based building and home improvement products, marketed under Royal Group brands, include window and door profiles, mouldings, siding, pipe and pipe fittings, deck, fence and rail and outdoor storage buildings. (source: company press release or website)

Why We Like It:
It looks like GGC might have produced a bottom. The last two weeks has seen a bullish trend of higher lows and the technical indicators suggest the stock is ready for another leg higher. We are suggesting a trigger to buy the stock at $17.35. That way GGC will have to breakout over its 50-dma first. This should be considered a more aggressive play since GGC does have plenty of overhead resistance to chew through. Watch for resistance near $18.00 and its 100-dma currently near $18.50. Our target is the $19.90-20.00 range.

Picked on May xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/04/07 (confirmed)
Average Daily Volume: 1.2 million

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McGrath RentCorp - MGRC - cls: 31.88 chg: +1.08 stop: 29.89

Company Description:
Founded in 1979, the Company, under the trade name Mobile Modular Management Corporation, rents and sells modular buildings to fulfill customers' temporary and permanent space needs in California, Texas and Florida. Mobile Modular believes it is the largest provider of relocatable classrooms for rental to school districts for grades K - 12 in California. The Company's TRS-RenTelco division rents and sells electronic test equipment and is one of the leading providers of general purpose and communications test equipment in North America. (source: company press release or website)

Why We Like It:
We usually try to avoid stocks with average daily volume this low. MGRC's average volume is about 94K a day. However, after months and months of consolidating under resistance at the $32.00 level the stock finally looks ready for another breakout attempt. MGRC has pierced resistance at $32.00 a few times so it's very possible that we could be triggered on an intraday spike. We'll try and avoid this with a trigger at $32.35. More conservative traders may want to use a trigger above $32.50. If we are triggered our target is the $35.75-36.00 range. The P&F chart is bullish with a $50 target.

Picked on May xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/03/07 (confirmed)
Average Daily Volume: 94 thousand
 

New Short Plays

Apt Inv. & Mgmt - AIV - cls: 55.40 chg: -0.16 stop: 56.05

Company Description:
Aimco is a real estate investment trust headquartered in Denver, Colorado that owns and operates a geographically diversified portfolio of apartment communities through 20 regional operating centers. Aimco, through its subsidiaries and affiliates, is the largest owner and operator of apartment communities in the Unites States with 1,237 properties, including 213,681 apartment units, and serves approximately 750,000 residents each year. (source: company press release or website)

Why We Like It:
REITs have been a pocket of weakness recently. Shares of AIV broke down under technical support at the 200-dma on April 30th and have not been able to rebound back above this level. The company reported earnings on Friday and the results failed to inspire any buying interest. We suspect the next move will be down. AIV has some support near $54.00 so we're suggesting a trigger to short it at $53.99. If triggered our target is the $50.25-50.00 range. If AIV traded under $54.00 it would produce a new Point & Figure chart sell signal.

Picked on May xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/04/07 (confirmed)
Average Daily Volume: 960 thousand

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Camden Property - CPT - cls: 67.98 chg: -0.23 stop: 70.05

Company Description:
Camden Property Trust is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 188 properties containing 64,769 apartment homes across the United States. Upon completion of 11 properties under development, the Company's portfolio will increase to 68,343 apartment homes in 199 properties. (source: company press release or website)

Why We Like It:
CPT is another REIT that is looking very vulnerable to more profit taking. The stock sold off sharply last week and is barely holding on to support near $68.00. Volume soared on Friday for no apparent reason. We suspect the next move is down. Nimble traders may want to watch for a bounce and failed rally under $70 as a new entry point for shorts. We're suggesting a trigger to short it at $66.99. If triggered our target is the $60.50-60.00 range. We do expect some support near $65.00. The P&F chart looks very bearish with a $58 target.

Picked on May xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/07 (confirmed)
Average Daily Volume: 526 thousand
 

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