NEW DIRECTIONAL PUT PLAYS
Rock-Tenn Co. - RKT - close: 42.84 change: -0.02 stop: 44.26
RockTenn (NYSE: RKT) is a leading North American producer of paperboard, containerboard and consumer and corrugated packaging, with annual net sales of approximately $2.8 billion. Based in Norcross, GA, we employ approximately 10,000 people and operate more than 90 facilities in the United States, Canada, Mexico, ChilÃ© and Argentina.
(source: company press release or website)
Why We Like It:
RKT has been raising prices on some of its products for months now and yet the company still missed earnings expectations back in January. The stock has formed a bearish double top back in 2009 and the breakdown under the $45-44 level of support was very bearish. Now the oversold bounce is beginning to roll over under old support and what is new resistance. I am very tempted to buy puts right now. However, I'm suggesting we wait for a little more confirmation. Use a trigger to initiate positions at $41.90. If triggered our target is $38.00. RKT found support back in February around $37.25.
Use a trigger to buy puts @ 41.90
Suggested Position: BUY PUT APRIL $40 (RKT 10P40.00) @ x.xx?
Entry on March xxth at $ xx.xx
Earnings Date 04/27/10
Average Daily Volume = 645 thousand
Listed on March 15th, 2010