Hanson Natural Corp - HANS - close 39.46 change -0.51 stop 38.25

Company Description:
Hansen Natural Corporation (Hansen) is a holding company. The Company, through its subsidiaries develops, markets, sells and distributes alternative beverage category natural sodas, fruit juices, juice blends, juice drinks, energy drinks and energy sports drinks, fruit juice smoothies and functional drinks, non-carbonated ready-to-drink iced teas, children’s multi-vitamin juice drinks, Junior Juice juices, Junior Juice Water and flavored sparkling beverages under the Hansen’s brand name. Hansen operates in two segments: Direct Store Delivery (DSD), whose principal products comprise primarily energy drinks, and Warehouse (Warehouse), whose principal products comprise primarily juice based and soda beverages. It develops, markets, sells and distributes energy drinks under the brand names, Monster Energy; Monster Hitman Energy Shooter and Lost Energy brand names, as well as Rumba, Samba and Tango brand energy juices.

Target(s): 40.95, 42.40, 43.25
Key Support/Resistance Areas: 42.50, 41.00, 40.25, 39.30, 38.50
Time Frame: 1 to 2 weeks

Why We Like It:
HANS got hit hard during the flash crash but has since held up well, making a series of higher lows. The stock is forming an ascending triangle on the daily chart and has an unfilled gap from the flash crash all the way up near $42.40. In addition, the stock is above its 20-day and 200-day SMA but has recently pulled back from its 50-day SMA. I suggest readers play for a bounce here with the building momentum of the ascending triangle. I also believe the S&P 500 will bounce as it is approaching the its 20-day SMA which should help stronger stocks that have performed. We have a good reference point to place a tight protective stop just below the 200-day SMA at $38.25, which also below the primary upward trend line. Our primary targets are $40.95 and $42.40.

Suggested Position: August $40.00 CALLS, current ask $2.35

Annotated Chart:

Entry on June xx
Earnings Date 8/5/10 (unconfirmed)
Average Daily Volume: 1.1 million
Listed on 6/22/10