Additional Trading Ideas:
In addition to tonight's new candidate(s), consider these stocks as possible trading ideas and watch list candidates. Some of these may need to see a break past key support or resistance:
Bearish ideas: SOHU, SINA
IMKTA, SF, GLNG, COH, CNK, HXL, NCLH, WFC, JBLU
NEW BULLISH Plays
The Fresh Market, Inc. - TFM - close: 41.37 change: +0.25
Stop Loss: 39.75
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on March -- at $---.--
Listed on March 14, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 628 thousand
New Positions: Yes, see below
Why We Like It:
Shares of TFM appear to have turned things around after a bumpy decline from its 2012 highs. This company is in the services sector.
According to the company website, "The Fresh Market, Inc. is a high-growth specialty retailer focused on creating an extraordinary food shopping experience for its customers. Since opening its first store in 1982, The Fresh Market has offered high-quality food products, with an emphasis on fresh, premium perishables and an uncompromising commitment to customer service. The Fresh Market currently operates over 160 stores in 27 states across the United States."
The company's 2014 Q3 earnings report in November was better than expected. Both earnings and revenues beat Wall Street estimates with sales up +15%. That trend continued in the fourth quarter. TFM reported its 2014 Q4 results on March 5th. Analysts were looking for $0.51 a share on revenues of $482.99 million. TFM delivered earnings of $0.55 cents, which is a +41% improvement from a year ago. Revenues were up +12.8% to $480.4 million, which is a miss. However, comparable store sales were up +3.0% and gross margins improved 80 basis points to 34.3%.
TFM issued fiscal year 2016 guidance that was mostly in-line with Wall Street estimates. They also announced they were closing all their stores in California. The company will choose to focus on higher-growth opportunities in the eastern half of the United States. Management felt that their organic growth in California wasn't strong enough. Investors seem pleased with the overall earnings report as TFM surged toward resistance near $42.00.
I will point out that the big drop in early January was news TFM's CEO and President had left the company. The sudden departure sent TFM plunging more than -10% on the day. Now shares of TFM have produced a bullish double bottom near the $35.50 area.
Today TFM looks poised to breakout past key resistance at the $42.00 level. It's also nearing major resistance on its weekly chart (see the trend line). Based on this weekly chart resistance we'll set the entry trigger to launch bullish positions at $42.50.
The point & figure chart for TFM is already bullish with a breakout past resistance and a current price target at $52.00. If TFM can rally past the $42.00 level shares could see a short squeeze. The most recent data listed short interest a 23% of the relatively small 40 million share float.
Trigger @ $42.50
- Suggested Positions -
Buy TFM stock @ (trigger)
- (or for more adventurous traders, try this option) -
Buy the JUN $45 CALL (TFM150619C45) current ask $1.55
Option Format: symbol-year-month-day-call-strike
Point & Figure Chart: