NEW DIRECTIONAL CALL PLAYS
Panera Break Co. - PNRA - close: 105.42 change: -0.33
Stop Loss: 103.90
Target(s): 109.95, 114.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger
Why We Like It:
The rally in PNRA over the past three and a half months has been pretty amazing. While upward momentum has paused the trend of higher lows is still suggesting there is further upside ahead. This is a pure momentum play and if shares can breakout past short-term resistance near $107.00 then PNRA could see some short covering.
The most recent data listed short interest at 9.5% of the small 28.7 million-share float.
I am suggesting we use a trigger to launch bullish positions at $107.15. If triggered our first, short-term target is $109.90. Our second, longer-term target is $114.00. This is an aggressive trade so we want to keep our position size small. FYI: The Point & Figure chart is very bullish with a $131 target.
Breakout Trigger @ $107.15
- Suggested Positions - (small positions) -
Buy the 2011 January $110 (PNRA1122A110)
- or -
Buy the 2011 February $115 (PNRA1119B115)
Entry on December xxth at $ xx.xx
Earnings Date 02/10/11 (unconfirmed)
Average Daily Volume = 389 thousand
Listed on December 20th, 2010