NEW DIRECTIONAL PUT PLAYS

Polaris Industries - PII - close: 109.21 change: -1.89

Stop Loss: 112.05
Target(s): 101.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
PII makes recreational vehicles. Products range from off-road vehicles to snowmobiles, to motorcycles. PII also manufacturers a number of accessories for this market. The stock's long-term trend is up and I would be longer-term bullish on PII. Yet it looks like the stock got ahead of itself with the super strong July rally.

Upward momentum stalled in August and shares have begun to correct lower. PII tried to find support near $110 but the bounce just failed near $112. Now PII is breaking down to new four-week lows and we suspect shares could see a correction toward round-number, psychological support near $100.

Friday's low was $108.85. I am suggesting a trigger to buy puts at $108.65. If triggered our target is $101.00.

Trigger @ 108.65

- Suggested Positions -

buy the Oct $105 PUT (PII1319v105) current ask $3.10

Annotated Chart:

Entry on September -- at $---.--
Average Daily Volume = 535 thousand
Listed on August 31, 2013


Red Robin Gourmet Burgers Inc. - RRGB - close: 64.86 change: -1.54

Stop Loss: 66.75
Target(s): 60.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of RRGB took off following its better than expected earnings results on August 15th. The bottom line beat Wall Street estimates by 11 cents. RRGB missed the revenue estimate. Management gave a relatively upbeat outlook for 2013. The four-day rally following its earnings numbers looks like a short squeeze. The latest push higher did lift RRGB past its old highs from 2005. Unfortunately the upward momentum has run out of steam.

It is worth noting that RRGB has managed to outperform many of its peers. The restaurant industry as a whole has been suffering from slower sales as consumers cut back on their discretionary spending thanks to higher taxes and rising prices at the gas pump. RRGB's longer-term trend is still higher. We're just trying to capture a correction back toward likely support near $60.00 and its 50-dma.

Friday's low was $64.74. I am suggesting a trigger at $64.65. Our target is $60.25.

Trigger @ 64.65

- Suggested Positions -

Buy the Oct $60 PUT (RRGB1319v60) current ask $1.05

Annotated Chart:

Entry on September -- at $---.--
Average Daily Volume = 152 thousand
Listed on August 31, 2013