NEW BULLISH Plays

Cheesecake Factory Inc. - CAKE - close: 31.59 change: +0.72

Stop Loss: 28.95
Target(s): 33.95, 37.00
Current Gain/Loss: + 0.0%
Time Frame: 8 to 10 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Restaurant stocks have been showing strength lately. Consumers, it would seem, are still going out to eat. Shares of CAKE are climbing after a multi-week consolidation above technical support at the 200-dma. I am suggesting bullish positions now or you can wait for a dip into the $31-30 zone. The 2010 high peaked near $34.00 so we'll set our first target at $33.95. Given enough time I would expect CAKE to breakout to new highs. Our second, more aggressive target is $37.00.

Keep in mind that CAKE doesn't move very fast (at least not normally) so we'll need some patience for this trade to work. FYI: The Point & Figure chart for CAKE is bullish with a $59 target.

Suggested Position: buy CAKE stock @ current levels

- or -

buy the July $33 call (CAKE1116G33) current ask $0.85

Annotated chart:

Entry on May 20 at $xx.xx
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 1.0 million
Listed on May 19th, 2011