NEW BULLISH Plays
Noble Corp - NE - close 34.86 change +0.46 stop 32.25
Target(s): 36.85, 38.30
Key Support/Resistance Areas: 36.95, 38.50, 33.50
Time Frame: 1 to 3 weeks
Noble Corporation (Noble) is an offshore drilling contractor for the oil and gas industry. The Company performs contract drilling services with its fleet of 62 mobile offshore drilling units. This fleet consists of 13 semisubmersibles, four drillships, 43 jackups and two submersibles. The fleet count includes two units under construction: one ultra-deepwater, Globetrotter-class drillship, and one deepwater semisubmersible. As of January 28, 2010, approximately 87% of the Companyâ€™s fleet was deployed in the Middle East, India, Mexico, the North Sea, Brazil and West Africa.
Why We Like it:
Fundamentally NE is a cheap stock that trades at a PE under 7. Technically, the stock broke out of a downtrend line that began on 4/27. Volume has been picking up as the stock is moving higher and it is also consolidating near its highs on lighter volume, which is a bullish sign. I suggest we use a trigger of $34.60 to open long positions. Our two targets are +6.5% and +10.5% higher. Our initial stop will $32.25 which is below the rising 20-day and 50-day SMA's.
Suggested Position: Long NE stock if it trades to $34.60
Options Traders: Buy October $36.00 CALL, current ask $1.01
Entry on September XX
Earnings 10/20/10 (unconfirmed)
Average Daily Volume: 3.7 million
Listed on September 11, 2010