NEW BULLISH Plays
The Andersons, Inc - ANDE - close 36.92 change +0.10 stop 33.33
The Andersons, Inc. is an entrepreneurial, customer-focused company with interests in the agriculture and transportation markets. The Company operates in five business segments: Grain & Ethanol, Rail Group, Plant Nutrient Group, Turf & Specialty Group, and Retail Group. In August 2009, the Company completed the acquisition of the assets of the fertilizer division of Hartung Brothers, Inc. (HBI).
Target(s): 39.15, 40.50, 41.50
Key Support/Resistance Areas: 41.50, 40.50, 39.20, 38.00, 35.50
Time Frame: 1 to 3 weeks
Why We Like It:
We are back with a play in the agriculture sector after a nice winning trade in IPI that was closed this week. The agriculture sector continues to heat up and is gaining momentum. Farmers want and need to grow more food to keep up with demand, especially from emerging markets. Many potash companies have seen significant gains in recent weeks because potash levels need to be replenished in farmland soil. ANDE is a downstream play in this space as they provide products and services to the industry that enable farmers to grow crops and distribute them. I also believe this stock and sector can do well in a down market. Technically, ANDE is forming a long term ascending triangle while finding support above a key pivot level since March (see ovals on chart). I suggest readers take advantage of the momentum and initiate long positions now. Our initial stop will be $33.33, which is below upward trend lines and moving averages, but it will be adjusted as the trade develops. Our targets are +6%, +9.5%, and +12% higher, respectively. NOTE: Average daily volume is a tad light in this stock so I consider it an aggressive play. However, volume has ticked up significantly in recent days/weeks which is a bullish sign.
Suggested Position: Long ANDE stock at current levels
Options Traders: Buy December $40.00 Calls, current ask $2.10
Annotated daily chart:
Annotated weekly chart:
Entry on August xx
Earnings 10/28/2010 (unconfirmed)
Average Daily Volume: 180,000
Listed on August 18, 2010