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FO None
NBL  
SUN  

New Calls

Fortune Brands - FO - close: 90.51 chg: +1.71 stop: 86.95

Company Description:
Fortune Brands, Inc. is a USD7 billion leading consumer brands company. Its operating companies have premier brands and leading market positions in home and hardware products, spirits and wine, golf equipment and office products. Home and hardware brands include Moen faucets, Aristokraft, Schrock, Diamond and Omega cabinets, Therma-Tru door systems, Master Lock padlocks and Waterloo tool storage sold by units of Fortune Brands Home & Hardware, Inc. Major spirits and wine brands sold by units of Jim Beam Brands Worldwide, Inc. include Jim Beam and Knob Creek bourbons, DeKuyper cordials, Starbucks(TM) Coffee Liqueur, The Dalmore single malt Scotch, Vox vodka and Geyser Peak and Wild Horse wines. Acushnet Company's golf brands include Titleist, Cobra and FootJoy. Office brands include Swingline, Wilson Jones, Kensington and Day-Timer sold by units of ACCO World Corporation. (source: company press release or website)

Why We Like It:
We had our eye on FO as a possible bullish candidate a few weeks ago when it was consolidating between $85 and $88. Then it gapped higher and sort of got away from us. Now the recent action over the past two weeks has filled the gap and produced another rebound with shares looking poised to hit new highs soon. The MACD indicator is nearing a new buy signal soon and its shorter-term oscillators are also bullish. The Point & Figure chart shows a triple-top breakout buy signal pointing to a $110 target. We think bulls can use the push back above the $90.00 level on Friday as a new entry point. Our target will be the $95-96 range but whether FO gets to our target or not we're closing the play before its late July earnings report. More aggressive players might aim for the $98-100 region.

Suggested Options:
We are suggesting the August calls. September strikes are available and have more open interest.

BUY CALL AUG 85.00 FO-HQ OI= 0 current ask $6.60
BUY CALL AUG 90.00 FO-HR OI=10 current ask $2.85
BUY CALL AUG 95.00 FO-HS OI=28 current ask $0.85

Picked on July 03 at $ 90.51
Change since picked: + 0.00
Earnings Date 07/22/05 (unconfirmed)
Average Daily Volume = 648 thousand

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Noble Energy - NBL - close: 77.62 chg: +1.97 stop: 73.99

Company Description:
Noble Energy is one of the nation's leading independent energy companies and operates throughout major basins in the United States including the Gulf of Mexico, as well as the recently added Patina Oil & Gas properties located primarily in Colorado's Wattenberg Field, the Mid-continent region of western Oklahoma and the Texas Panhandle, and the San Juan Basin in New Mexico. In addition, Noble Energy operates internationally in Argentina, China, Ecuador, Equatorial Guinea, the Mediterranean Sea and the North Sea. Noble Energy markets natural gas and crude oil through its subsidiary, Noble Energy Marketing, Inc. (source: company press release or website)

Why We Like It:
A bounce in crude oil on Friday helped light a fire under the oil stocks again and many look poised for another leg up after two or three weeks of consolidating their May gains. NBL happens to be one such stock and shares added 2.6 percent on Friday. Technical oscillators are turning bullish again and its P&F chart looks very strong as it points to a $109 target. We are suggesting that readers use a trigger over the $78.00 level to open the play. Our entry point will be 78.15. Our target is the $84-85 region, which coincides with analysts' mean price target on the stock. We do not plan on holding over the early August earnings report.

Suggested Options:
We are suggesting the August calls. At this time we don't see any strikes above $80.00.

BUY CALL AUG 75.00 NBL-HO OI= 468 current ask $4.60
BUY CALL AUG 80.00 NBL-HP OI=1306 current ask $1.95

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/03/05 (unconfirmed)
Average Daily Volume = 1.0 million

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Sunoco Inc - SUN - close: 117.87 chg: +4.19 stop: 112.45

Company Description:
Sunoco, Inc., headquartered in Philadelphia, PA, is a leading manufacturer and marketer of petroleum and petrochemical products. With 900,000 barrels per day of refining capacity, approximately 4,800 retail sites selling gasoline and convenience items, over 4,300 miles of crude oil and refined product owned and operated pipelines and 38 product terminals, Sunoco is one of the largest independent refiner-marketers in the United States. Sunoco is a significant manufacturer of petrochemicals with annual sales of approximately five billion pounds, largely chemical intermediates used to make fibers, plastics, film and resins. Utilizing a unique, patented technology, Sunoco also has the capacity to manufacture over 2.5 million tons annually of high-quality metallurgical-grade coke for use in the steel industry. (source: company press release or website)

Why We Like It:
SUN is another oil stock that got a boost from the bounce in August crude on Friday. SUN is an oil refiner who also has almost five thousand retail pumping stations. The rise in oil certainly helps them on both fronts. Friday's gain also pushed the stock price above the top of its two-week trading range at $117.20. SUN's MACD indicator may look overbought but the other technical indicators are turning bullish again. The P&F chart points to a $163 price target. We are going to target a move into the $124.50-125.00 range. The biggest risk here is that oil dips again and SUN doesn't recover before its July 21st earnings report, of which we plan to exit before the company announces.

Suggested Options:
We are suggesting the August calls.

BUY CALL AUG 115.00 SUN-HC OI=414 current ask $7.10
BUY CALL AUG 120.00 SUN-HD OI=202 current ask $4.50
BUY CALL AUG 125.00 SUN-HE OI=119 current ask $2.60

Picked on July 03 at $117.87
Change since picked: + 0.00
Earnings Date 07/21/05 (unconfirmed)
Average Daily Volume = 1.3 million
 

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