PremierInvestor.net Newsletter Tuesday 07-20-2004 section 1 of 2 Copyright (c) 2004, All rights reserved. Redistribution in any form is strictly prohibited. The entire newsletter is best viewed in COURIER 10 for alignment ================================================================= In section one: Market Wrap: Cash Talks in After Hours Watch List: --first four symbols here -- and more! Market Sentiment: Bargain Shopping ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 07-20-2004 High Low Volume Adv/Dcl DJIA 10149.07 + 55.00 10155.63 10072.68 1.75 bln 1893/1324 NASDAQ 1917.07 + 33.20 1917.07 1885.80 1.63 bln 2103/ 995 S&P 100 539.65 + 3.36 539.81 535.10 Totals 3996/2319 S&P 500 1108.67 + 7.77 1108.88 1099.10 SOX 423.47 + 10.20 423.48 413.13 RUS 2000 564.19 + 9.46 564.25 554.73 DJ TRANS 3154.75 + 49.60 3155.33 3104.84 VIX 14.17 - 1.00 15.57 13.98 VXO (VIX-O)14.58 - 0.37 15.85 14.45 VXN 20.91 - 1.30 22.30 20.66 Total Volume 3,670M Total UpVol 2,782M Total DnVol 818M Total Adv 4450 Total Dcl 2702 52wk Highs 145 52wk Lows 202 TRIN 0.72 NAZTRIN 0.39 PUT/CALL 0.65 ================================================================= =========== Market Wrap =========== Cash Talks in After Hours by Jim Brown The weakness from the last several days finally wore off just prior to the Greenspan testimony and the major indexes recovered some of their losses. That was not the big story of the day. After the close the richest company in the U.S. decided to return $75 billion to shareholders over the next four years. Dow Chart Nasdaq Chart The markets started off in negative territory after New Home Construction dropped to only 1.80 million units and well below consensus of 1.98 million and the May rate of 1.97 million. This is a massive drop considering how strong the sector has been recently. This was also the biggest drop since Feb-2003. Single-family starts were the hardest hit and new permits are also down. With the June decline closing out Q2 we now have two consecutive quarters of declines in housing. The long awaited collapse of the housing bubble may be closer than we previously thought. The drop in June was led by single family but the multi family units were also down with a decline of -3.7%. The rental sector has been seeing a rise in vacancy rates that depressed new construction but that should end soon. The baby boomers will be selling their family homes and moving into cheaper rentals and condos in an effort to get by on social security. This should boost the multi family market over the next five years. The housing sector was understandably weak today but not as bad as you would have expected. The downtrend has been predicted for months and this was just real confirmation of that trend. BZH fell below support at $90 but quickly recovered. CTX hit a new nine-month low at $41 and its downward trend accelerated but the drop was still minimal. Dominion Homes had telegraphed this weakness last week when it said they were seeing a significant rise in order cancellations. They are predominantly located in the Midwest and this appears to be where the general economic slowdown in May/June originated. The general housing slowdown came from the sudden increase in rates back in April when the ten-year yield jumped from its 3.65% March low to the 4.9% high in May. We saw a rush to buy houses in April as buyers tried to lock in prices and rates but it appears many of those sales were cancelled in May/June. Since May the rates have been falling and we saw a new three month low of 4.51% on Monday. This should help builders unload current inventory but the dropping housing starts suggests they are not in a hurry to build into the increasing economic uncertainty. Further consumer weakness was seen in the Chain Store Sales at +0.2% for the last week. Since May-29th the total weekly increase in sales has amounted to only -0.1%. With sales flat and due in most part to the rising oil prices they are not likely to get better any time soon. Oil rocketed to $41.95 today before pulling back on profit taking and there is nothing to keep it from going higher. This was very near the $42.30 high set on the last bounce in May. OPEC is pumping well over the levels seen in May and the price is still rising. Even 99 Cents Only stores (NDN) found conditions tough in the last quarter. They missed earnings by a penny on an overall revenue increase of +14% but same store sales were down -2.5% and costs were higher. Growing competition helped to shrink margins. Schwab (SCH) jumped in early trading after missing estimates by a penny on weak volume. The CEO resigned and Charles Schwab was picked to come back in to run the company and revive sagging revenues. The company said price cuts needed to stay competitive had produced a -30% drop in net income on 20% fewer revenue producing trades. The CFO said job cuts would likely continue despite more than -10,000 jobs already eliminated since the 2000 market bubble. Schwab said "mixed securities market returns, continuing geopolitical uncertainties and concerns about rising interest rates all weighed on client engagement during much of the quarter. Client daily average revenue trades declined by 20% from the first quarter." Welcome to summer trading in 2004. Russell Chart The big news for the morning was the impending testimony by Greenspan to the Senate Banking Committee. Stocks recovered off their early morning lows as speculators took positions hoping for some good news and shorts covered just in case that good news appeared. The SOX rose +2.47% to 423 and well off its 408 lows from Monday. This helped pull the Russell back from the brink at 551 on Monday to close at 563 today and back over the 560 resistance level. The Nasdaq was the beneficiary of all this good news and after trading at 1870 on Monday it recovered to close at 1914, back over 1900 and just above 1910 resistance. The Dow recovered to 10150 and with the news after the bell it should be substantially higher tomorrow. This was all in motion before the Greenspan testimony and stocks got a further substantial boost after the close. The Greenspan ramp on the hope of a cooling interest rate calendar was served a small disappointment with the prepared comments where he continued to suggest the Fed was prepared to act aggressively if the need arose. There was plenty of boiler plate about the measured pace wording just to assure investors they were not going to race ahead but the message was clear, more rate hikes ahead. Overall Greenspan's testimony was positive with the headline sentence proclaiming economic developments in the U.S. "have been" quite favorable in 2004 and there is support for the view the expansion will be self-sustaining. He said inflation was not a problem and the recent jump in the numbers was a transitory move due to the spike in energy prices. (I assume he meant transitory if oil does not break $32 this week) Greenspan also said the jump in hiring in the last six months was encouraging although the rate has eased. According to Manpower, who beat earnings by +4 cents, (+2 cents was due to currency translation), the outlook was not as great and they guided lower for Q3 on lower than expected revenues. Kelly Services also warned that the future job expectations may be weaker. Greenspan warned that lower demand and higher unit labor costs could pressure profits for the rest of 2004. Greenspan said the Fed was prepared to act aggressively to maintain prices but warned that weak production and the weak demand was going to depress prices companies could receive on their goods. This would shrink future profit margins until demand returned. He suggested GDP was running at a 3.5% to 4% rate. Unfortunately the strong drop in housing today could impact that GDP by up to a point by Q4. The building community consumes vast amounts of raw materials, furniture, fixtures and appliances. A continued slowdown like we saw today could have a serious ripple down impact. He repeated the obituary on deflation and explained the risk was mostly due to the stock market crash and the reduction of capital available to spend on consumer goods. I think that is a pretty good assumption. Greenspan continued to repeat the mantra that the Fed had maintained abnormally low rates for an extended period of time and that accommodation had benefited the economy significantly. No complaints there. However, he also maintained that the Fed needed to remove that accommodation at a measured pace to bring Fed policy back in line with reality. Nothing he said suggested they were going to pass on the expected rate hike on August 10th but he also said nothing to indicate it could be the +50% analysts previously expected. It seems a sure thing now that another 25 points will be added in August and the markets simply need to accept it. With bonds already pricing in three more hikes there should not be any material impact from an August hike. He did make a point that there were potential outside risks (as in another terrorist attack) and the Fed would quickly react to assess and manage these events if they occurred. Interesting that he added that statement as we near the conventions and Olympics. The market gains into the testimony were shredded as the various comments came out but in the end we moved higher again just before the close. With a flurry of tech earnings after the bell investors did not appear in a hurry to exit. Considering the after hours events it was a good choice. MOT rose after reporting gains in market share from rivals in the cell phone market and upgrading guidance for next quarter. SUNW also moved higher after posting a profit and revenue actually rose for the first time in 13 quarters. SANM jumped after beating the street and said demand for its high end products was increasing. Etrade beat the street by a mile at +31 cents compared with estimates of +13 cents with results helped by the sale of its ATM business. MCHP beat the street and raised its dividend. PXLW beat by a penny as did STX, STK and WEBX. Not all the news was good. TXN reported inline and guided slightly lower for next quarter. RFMD beat the street and warned for the current quarter. Still all in all the tech news was good and techs should have had a good day on Wednesday. It was this last piece of news that gave us the biggest bounce. Microsoft jumped in front of its Thursday earnings announcement with the cash spending plan we have been expecting. Considering the amount of cash they have to spend it was the mother of all cash disbursement programs. Microsoft announced they were going to issue a one time $3.00 dividend and raise their quarterly dividend to eight cents per quarter. They also announced a $30 billion stock buyback program. The total benefit package amounts to $75 billion over the next four years. This gave MSFT a real shot in after hours trading with the last trade at $29.81 for about a +1.60 jump from the close. With futures moving higher overnight on the positive tech/chip earnings and the Microsoft news the odds are very good this Microsoft announcement will produce a strong bounce at the open. For those in the Editors Play on Microsoft be sure to tune into the Market Monitor in the morning for exit directions. While this may appear a strong move by Microsoft and you would think the stock will rocket higher we may be surprised. The news has been expected for over a month and the stock has already moved from its support at $26 to trade at the mid $28 range on expectations. Because the buyback is going to be spread over four years it may receive a lukewarm welcome from MSFT investors. The $3 one-time dividend would be slightly less than the amount the stock has risen from the $26 support in May to the overnight close at $29.81. We could easily see investors take profits now on the expectation that the dividend is already priced in. Had the buyback been over the next six months then we could have seen some real movement but over four years may produce a yawn from the more impatient types. Funds holding MSFT will receive a windfall and probably will not change positions. I seriously doubt they will run out and buy more at the inflated price regardless of the hype. It will be interesting to see how Mr. Softee trades tomorrow. For Wednesday we have Greenspan testimony again at 10:00 and he will get to change anything he felt he said wrong today. Since there was nothing of material impact to the market I doubt he will change anything in his prepared remarks. The markets will still hold their breath during the Q&A to see if anything new appears. The three days beginning today are the three heaviest days for earnings in this cycle. I believe everyone knows now that the Q2 was good for business despite the end of quarter slump. Most companies are guiding inline but we are seeing an increase in those guiding flat to lower. No surprise there. We only have three trading days left before the democratic convention begins and the odds are good we will see some selling once tomorrows bounce runs its course. We should see some serious knee jerk short covering at the open and it remains to be seen if it will have legs. I would definitely not be a buyer this week. I believe discretion is called for this week and I would not be a buyer for other than a day trade until after the convention is over. I suspect there are quite a few others who believe the same way. This does not mean they won't nibble at some longs just in case nothing happens. I would like to believe that the security is so tight that nothing could possibly happen but I am not willing to risk my capital on that premise. There will always be another trade. Enter Passively, Exit Aggressively. Jim Brown Editor ================================================================== WATCH LIST ================================================================== The PremierInvestor.net watch list is not designed to be read as full fledged stock picks. Rather we would prefer to offer it as an extra tool in today's investor toolbox. Think of it as a radar screen with your own radar operator pointing out interesting developments, technical patterns or potential plays that you may or may not have seen on your own. Due to time constraints we do glance at the news but rarely do we have time to fully read pertinent news stories, due background research and other necessary screens that investors should do before making a decision. A common exercise is to read the entry, glance at the sector and other stocks in that industry and then compare what's happening in the stock to what's happening in the broader market indices. We hope you enjoy the Watch List and that it proves to be a useful tool for your own trading success. STOCKS WORTH WATCHING --------------------------------- Financial services to Telecom AT&T Corp - T - close: 14.31 change: -0.32 WHAT TO WATCH: It doesn't look good for shares of T. The stock failed to participate in the market's bounce today. T has slowly been slipping lower under a stream of lower highs as traders sell any strength at the 21-dma. Its MACD is close to producing a new sell signal again. As ugly as T looks right now it is worth noting that shares have support in the $13.50 region (April 2003 lows) and the $13 level also happens to be its P&F bearish target. It is very possible for those targets to be surpassed and the relative weakness here looks tempting. Thursday could produce some volatility with the crowd of telecom-related stocks announcing earnings. --- World Acceptance Corp - WRLD - close: 19.27 change: +0.76 WHAT TO WATCH: WLRD might be worth doing a little due diligence on. The recent breakout over its simple 200-dma and the $19.00 level looks encouraging. We would not consider bullish plays until WRLD broke through the $20 mark or maybe the April highs near $20.31. Such a move should break through heavy P&F chart resistance and clear the way for a move toward $23.50-24.00. --- Humana Inc - HUM - close: 17.60 change: +0.40 WHAT TO WATCH: Healthcare stocks have been pretty strong the last couple of weeks or in HUM's case they haven't slipped lower the last few days. HUM has actually been consolidating its mid-July gains in a tight trading range above the $17 mark. Today's move leaving it above $17.50 is encouraging but we're worried about resistance at its simple 100-dma just under $18.00. Look for the breakout and consider targeting the 200-dma under $20. --- Americredit Corp - ACF - close: 20.41 change: +0.77 WHAT TO WATCH: ACF, like WRLD, is a financial services company. ACF's daily chart has produced a new buy signal on its MACD indicator. Plus, the 3.9% rally today pushed it above psychological resistance at $20.00. There is still historical resistance near $20.50 and traders may want to look for a close over $20.50 as confirmation. The P&F chart is bullish with a $28.50 price target. ----------------------------------- RADAR SCREEN - more stocks to watch ----------------------------------- BCO $32.30 +0.32 - Once again Brinks has pulled back to the bottom of its rising channel. This looks like an entry point. ROG $63.73 -1.27 - Rogers lack of bounce today and its close under the simple 50-dma looks bearish. However, we'd be careful here. ROG has closed under the 50-dma in the past only to rebound immediately. If it fails to rebound consider it a possible bearish candidate. Unfortunately, we're concerned the 100-dma could also be support. =============================== Market Sentiment =============================== Bargain Shopping - J. Brown The NASDAQ turned in a pretty good session but the Dow's 55-point gain really doesn't reflect the oomph behind today's bounce. Investors were out doing some bargain shopping. All the major tech sectors were strongly higher in the 2%-3% range. Yet considering how oversold these groups were I'm surprised it wasn't higher. Can you blame the bounce on Greenspan's positive comments about the economy? Maybe but the rebound actually started before he began speaking in the afternoon. Alan's outlook for growth certainly doesn't hurt stocks here. Overall the market internals were pretty bullish. Advancing stocks outpaced decliners 17 to 10 on the NYSE and 2 to 1 on the NASDAQ. Up volume was more than double down volume on the NYSE and more than four times down volume on the NASDAQ. Those are some strong numbers. Investors should still be cautious here but we could easily see the rebound continue at least short term. Many of the tech- related sector indices have been sinking for two or three weeks straight so a multi-day bounce is in order. Just be sure to follow up your stops if you decide to open bullish plays. There are plenty of bears just looking at the bounce as a new entry point to get short. Tomorrow will be another huge day for corporate earnings but Greenspan will steal the stage Wednesday morning with day two of his bi-annual appearance before Congressional and Senate committees. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 10753 52-week Low : 8996 Current : 10149 Moving Averages: (Simple) 10-dma: 10183 50-dma: 10217 200-dma: 10205 S&P 500 ($SPX) 52-week High: 1163 52-week Low : 960 Current : 1108 Moving Averages: (Simple) 10-dma: 1109 50-dma: 1116 200-dma: 1104 Nasdaq-100 ($NDX) 52-week High: 1559 52-week Low : 1204 Current : 1421 Moving Averages: (Simple) 10-dma: 1422 50-dma: 1447 200-dma: 1447 ----------------------------------------------------------------- CBOE Market Volatility Index (VIX) = 14.17 -1.00 CBOE Mkt Volatility old VIX (VXO) = 14.58 -0.37 Nasdaq Volatility Index (VXN) = 20.91 -1.30 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.66 811,128 531,659 Equity Only 0.57 673,255 386,264 OEX 1.09 16,542 17,981 QQQ 0.65 29,844 19,476 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 64.2 - 1 Bear Confirmed NASDAQ-100 42.0 - 1 Bear Confirmed Dow Indust. 63.3 - 3 Bear Confirmed S&P 500 58.8 - 1 Bear Confirmed S&P 100 61.0 - 2 Bear Correction Bullish percent measures the number of stocks in an index currently trading on a buy signal on their point and figure chart. Readings above 70 are considered overbought, and readings below 30 are considered oversold. Bull Confirmed - Aggressively long Bull Alert - Cautiously long Bull Correction - Pause or pullback in upward trend Bear Alert - Take defensive action if long Bear Confirmed - High risk if long, good conditions for shorting Bear Correction - Pause or rebound in downtrend ----------------------------------------------------------------- 5-dma: 1.41 10-dma: 1.34 21-dma: 1.27 55-dma: 1.19 Extreme readings above 1.5 are bullish, and readings below .85 are bearish. These signals don't occur often and tend be early, but when they do, they can signal significant market turning points. ----------------------------------------------------------------- Market Internals -NYSE- -NASDAQ- Advancers 1742 2054 Decliners 1058 969 New Highs 97 32 New Lows 31 53 Up Volume 1185M 1371M Down Vol. 532M 246M Total Vol. 1750M 1634M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 07/13/04 Weekly COT report discloses positions held by small specs and commercial traders of index futures contracts at the Chicago Mercantile Exchange and Chicago Board of Trade. COT data can be found at www.cftc.gov. Small specs are the general trading public with commercials being financial institutions. Commercials are historically on the correct side of future trend changes while small specs tend to be wrong. S&P 500 Not much movement going on in the Commercial traders' positions for the large S&P futures contracts. They remain net bearish but by a small margin. Small traders remain net bullish but have upped their shorts a bit. Commercials Long Short Net % Of OI 06/22/04 407,842 415,462 ( 7,620) (0.9%) 06/29/04 405,273 413,351 ( 8,078) (0.9%) 07/06/04 402,952 416,526 (13,574) (1.7%) 07/16/04 407,166 416,869 ( 9,703) (1.2%) Most bearish reading of the year: (111,956) - 3/06/02 Most bullish reading of the year: 23,977 - 12/09/03 Small Traders Long Short Net % of OI 06/22/04 124,985 89,934 35,051 16.3% 06/29/04 129,978 94,535 35,443 15.7% 07/06/04 132,423 90,748 41,675 18.7% 07/16/04 133,935 95,787 38,148 16.6% Most bearish reading of the year: (1,657)- 5/27/03 Most bullish reading of the year: 114,510 - 3/26/02 E-MINI S&P 500 Commercial traders have reduced their long positions in the e-minis raising their net bearish positions several percentage points. Small traders are still very bullish. Commercials Long Short Net % Of OI 06/22/04 229,290 446,974 (217,684) (32.2%) 06/29/04 258,443 447,505 (189,062) (26.7%) 07/06/04 287,442 423,583 (136,141) (19.1%) 07/16/04 265,142 427,017 (161,875) (23.4%) Most bearish reading of the year: (354,835) - 06/17/03 Most bullish reading of the year: 133,299 - 09/02/03 Small Traders Long Short Net % of OI 06/22/04 243,444 58,389 185,055 61.3% 06/29/04 236,492 47,780 188,712 66.3% 07/06/04 219,321 58,567 160,754 57.8% 07/16/04 225,410 57,699 167,711 59.2% Most bearish reading of the year: (77,385) - 09/02/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 Commercial traders upped their long positions a bit boosting their bullish stature on the NDX. Small traders reduced both their longs and shorts but the drop in long positions actually left them move bearish. Commercials Long Short Net % of OI 06/22/04 40,397 37,413 2,984 3.8% 06/29/04 41,078 37,194 3,884 4.9% 07/06/04 42,245 37,343 4,902 6.2% 07/16/04 44,211 37,007 7,204 8.9% Most bearish reading of the year: (21,858) - 08/26/03 Most bullish reading of the year: 25,160 - 06/01/04 Small Traders Long Short Net % of OI 06/22/04 9,311 9,950 (639) ( 3.3%) 06/29/04 7,437 11,904 (4,467) (23.1%) 07/06/04 9,345 16,527 (7,182) (27.8%) 07/16/04 7,847 15,243 (7,396) (32.0%) Most bearish reading of the year: (20,270) - 06/01/04 Most bullish reading of the year: 19,088 - 01/21/02 DOW JONES INDUSTRIAL Commercial traders are not making any big moves with their INDU futures positions and they remain net bullish. Meanwhile small traders have turned a bit more bearish, the most we've seen in weeks. Commercials Long Short Net % of OI 06/22/04 26,808 19,752 7,056 15.2% 06/29/04 27,278 20,512 6,766 14.1% 07/06/04 27,214 20,775 6,439 13.4% 07/16/04 27,773 20,573 7,200 14.9% Most bearish reading of the year: (8,322) - 1/16/01 Most bullish reading of the year: 15,135 - 10/16/01 Small Traders Long Short Net % of OI 06/22/04 5,626 7,798 (2,172) (16.2%) 06/29/04 4,930 7,682 (2,752) (21.8%) 07/06/04 5,969 8,227 (2,258) (15.9%) 07/16/04 5,292 9,068 (3,776) (26.3%) Most bearish reading of the year: (12,106) - 3/09/04 Most bullish reading of the year: 8,523 - 8/26/03 ----------------------------------------------------------------- ================================================================= To stop receiving this PremierInvestor.net Newsletter, send email to Contact Support ================================================================= DISCLAIMER ================================================================= This newsletter is a publication dedicated to the education of stock traders. The newsletter is an information service only. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. The newsletter picks are not to be considered a recommendation of any stock but an information resource to aid the investor in making an informed decision regarding trading in stocks. It is possible at this or some subsequent date, the editors and staff of PremierInvestor.net may own, buy or sell securities presented. All investors should consult a qualified professional before trading in any security. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. PremierInvestor.net staff makes every effort to provide timely information to its subscribers but cannot guarantee specific delivery times due to factors beyond our control. Please read our disclaimer at: http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html ***************************************************************** ADVERTISING INFORMATION For more information on advertising in PremierInvestor.net Newsletter, or any Premier Investor Network newsletter please contact Contact Support. ***************************************************************** Copyright ) 2003 PremierInvestor.net. and The Premier Investor Network. Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter Tuesday 07-20-2004 section 2 of 2 Copyright (c) 2004, All rights reserved. Redistribution in any form is strictly prohibited. The entire newsletter is best viewed in COURIER 10 for alignment ================================================================= Stop Adjustments: BORL, BOBJ, FLML Closed Plays: KCS Stock Splits: LM, WIRE Trading Ideas Value Plays With Bullish Signals Breakout to Upside (Stocks $5 to $20) Breakout to Upside (Stocks over $20) Breakout to Downside (Stocks over $20) Recently Overbought With Bearish Signals (Stocks over $20) ================================================================= Stop Loss Adjustments ================================================================= BORL - tech stock short - No change in stop at $7.36 Be prepared to exit/double check stops. BORL is bouncing. --- BOBJ - tech stock short - We were TRIGGERED at this morning's open when BOBJ hit $19.74. Unfortunately, that proved to be the low of the day as BOBJ rebounded with the tech sectors. --- FLML - high risk/reward short - Comment: double check your stops. Ours is at $20.06. We can't find any catalyst for the move but FLML rallied 9.8 percent on big volume today. That's a warning sign for the bears! ================================================================= Closed Plays ================================================================= KCS Energy - KCS - close: 13.75 change: -0.13 stop: 13.69 Readers already know we had been growing cautious on KCS the last few sessions. The stock was slowly consolidating and hinting at a drop through the bottom of its rising channel. Its MACD was also hinting at a new sell signal. Well now the MACD sell signal is clearly evident and KCS has broken mild support at its simple 10-dma. Today's early morning weakness triggered our stop loss at $13.69. We would still keep KCS on our watch list for a potential bullish play with a bounce from its simple 100-dma. Picked on July 04 at $13.64 Gain since picked: + 0.11 Earnings Date 05/05/04 (confirmed) Average Daily Volume: 562 thousand ================================================================= Stock Splits ================================================================= Announcements ------------- LM announces dividend hike and 3-for-2 stock split Shortly after today's opening bell, Legg Mason, Inc (NYSE:LM) announced that its Board of Directors had approved a 3-for-2 stock split of its common shares in the form of a 50% stock dividend. The Board also announced a 50 percent increase in their quarterly cash dividend. The payable date for the stock split is September 24th, 2004 to shareholders on record as of September 8th. This would be LM's first stock split since the 3rd quarter of 1998. The BoD also approved their 24th consecutive year of dividend increases, by raising their quarterly cash dividend to $0.15/share, from $0.10/share. The new quarterly dividend is payable on October 25th, to shareholders on October 7th. About the company: Legg Mason, Inc., headquartered in Baltimore, is a holding company that provides asset management, securities brokerage, investment banking and related financial services through its subsidiaries. (source: company press release) --- WIRE declares 3-for-2 stock split After today's closing bell, Encore Wire Corporation (NASDAQ:WIRE) announced that its Board of Directors had approved a 3-for-2 stock split of its common shares in the form of a 50% stock dividend. The payable date for the stock split is August 16th, 2004 to shareholders on record as of August 6th. The Board stated that fractional shares resulting from the split would be paid in cash. The split announcement comes after shareholders voted to increase the number of authorized shares from 20 million to 40 million. About the company: Encore Wire Corporation manufactures a broad range of copper electrical wire for interior wiring in homes, apartments, manufactured housing and commercial and industrial buildings. ================== Trading Ideas ================== This section contains stocks that meet criteria which may make them of interest to long and short side traders. These are not recommendations, nor have they been reviewed by PremierInvestor editors for investment potential. However, each of them has technical and fundamental characteristics that make them worthy of further review by traders and investors looking for fresh ideas. New stocks will appear daily following the market close. Value Plays With Bullish Signals --------------------------------- Ticker Company Name Close Change GSK GlaxoSmithKline 39.93 +0.57 HD Home Depot 33.98 +0.71 AXP American Express 49.05 +0.60 IBM Intl Business Machines 86.28 +0.98 KFT Kraft Foods 31.68 +0.55 TGT Target Corp 43.39 +0.65 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- GLW Corning Inc 12.74 +1.47 AMTD Ameritrade 10.71 +1.32 URI United Rentals 18.84 +1.12 TEN Tenneco Automotive 14.23 +1.88 IDBE ID Biomedical 10.35 +2.51 ALDN Aladdin Knowledge 18.85 +3.38 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- CNI Canadian Natl Railway 44.90 +2.28 ZION Zions Bancorp 64.17 +1.02 DNB Dun & Bradstreet 56.62 +4.02 TK Teekay Shipping 40.23 +1.40 NPO Enrpo Industries 24.14 +1.54 ULBI Ultralife Batteries 21.84 +1.35 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- BSX Boston Scientific 34.78 -1.37 FRX Forest Labs 50.18 -2.32 ACE Ace Ltd 40.26 -1.67 XL XL Capital Ltd 71.87 -2.51 RE Everest Re 74.83 -6.13 HU Hudson United 35.90 -1.29 PTP Platinum Underwriters 29.25 -1.50 TASR Taser Intl 31.04 -5.28 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- PCL Plum Creek Timber 31.92 -1.15 BER W.R.Berkley 41.01 -2.77 RYN Rayonier Inc 44.60 -1.09 NBP Northern Borders 39.92 -2.08 PD Phelps Dodge 76.94 -2.28 ================================================================= To stop receiving this PremierInvestor.net Newsletter, send email to Contact Support ================================================================= DISCLAIMER ================================================================= This newsletter is a publication dedicated to the education of stock traders. The newsletter is an information service only. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. The newsletter picks are not to be considered a recommendation of any stock but an information resource to aid the investor in making an informed decision regarding trading in stocks. It is possible at this or some subsequent date, the editors and staff of PremierInvestor.net may own, buy or sell securities presented. All investors should consult a qualified professional before trading in any security. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. PremierInvestor.net staff makes every effort to provide timely information to its subscribers but cannot guarantee specific delivery times due to factors beyond our control. Please read our disclaimer at: http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html ***************************************************************** ADVERTISING INFORMATION For more information on advertising in PremierInvestor.net Newsletter, or any Premier Investor Network newsletter please contact Contact Support. ***************************************************************** Copyright 2003 PremierInvestor.net. and The Premier Investor Network. Do not duplicate or redistribute in any form.
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