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By Leo Fasciocco -- TTD
Ticker Tape Digest presents its daily breakout and Short Selling report. It contains Breakout Stocks and Stocks under Significant Accumulation.Data is from tape action for the day. These stocks are most suitable for aggressive investors seeking ideal entry points for leading stocks.
These stocks will do very well during bull markets and strong market rallies.
TTD also presents Stocks To Sell or Sell Short.These issues are suitable for aggressive investors willing to take short positionsboth as trades or for longer-term plays. These stocks will do very well during bear markets or market corrections
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Total Buy Breakouts so far today - 18
Stocks Screened- 8,200
Bull side - Breakout list expands today with some very good looking breakout plays. Bulls be venturesome.
Long-Term Environment for bulls: Favorable.
Market Status (Daily) - NYSE Bullish, Nasdaq Bullish
Market Status (Weekly) - NYSE Bullish, Nasdaq Bullish
OO, based in Foothill Ranch, Ca., makes high-performance sunglasses and goggles for the sports and fashion market. Annual revenues: $761 million. OO breaks out from an 11-week, cup-and-handle base today and hits a new 52-week high. Today's move comes as volume soars to 1.6 million shares, about four times its normal daily volume of 419,000 shares.
TTD did spot some profit taking during today's trading in the morning. However, OO has firmed up going into the late afternoon. One of the largest trades in the afternoon was a big block of 15,400 shares, which crossed on a modest up tick to $24.58.
OO's line of eyewear sells from the mid-level to upscale range and features high-tech designs, including interchangeable, high-optical clarity lenses and damage resistance.
OO sells through about 200 stores. Its stores operates under the O Stores and Oakley Vault names.
The company also sells athletic shoes, watches, apparel, and accessories.
OO's stock has had a bumpy ride the past several years. (see TTD's long-term chart) However, the stock has been strong the past 12 months and is now in position to push to a new all-time high. That coupled with a strong earnings outlook this year, makes OO a very good looking play.
TTD's daily chart shows a classic breakout from a well-formed, cup-and-handle base. The base showed excellent contraction of volume near the low points. That is bullish. The breakout move today is a "gap breakout" which is bullish too.
The stock's accumulation - distribution line hits a new peak providing good confirmation of the price breakout. Also, the TTD momentum indicator has edged back into the bullish zone.
OO came in with net for the first quarter of 8 cents a share, up from 3 cents a year ago. The quarter is one of its slowest. Nevertheless, the numbers were good and revenues increased to $199 million from $152 million.
This year, analysts predict OO's net will jump 38% to 96 cents a share from 69 cents a year ago. The stock sells with a price-earnings ratio of 25. That is reasonable and comfortably below the earnings growth rate. Going out to 2008, OO's net should rise 23% to $1.17 a share.
Strategy Opinion: OO looks to be on the right track now. TTD is very bullish on OO. We are targeting the stock for a move to 30 within the next few months. A protective stop can be placed near 22. TTD rates OO a very good intermediate-term play because of the strong earnings outlook this year.
Sponsorship: Good. The largest fund holder is 3-star rated Oppenheimer Global Fund with a big 9.9% stake. It has held its position steady. A key buyer recently was 5-star rated ING Fmr Diversified Mid Cap Fund, which purchased 182,000 shares.
Founder and chairman Jim Jannard owns 63% of the stock. Scott Olivet, Oakley's CEO, joined the firm from NIKE.
Insider Activity: Neutral. OO insiders have been recent buyers using stock options, but they have turned around and sold. 7 analysts follow the stock, 2 have a buy, 5 are neutral.
| TTD's Breakout Profile
Rating Oakley Inc. (OO) |
| TTD Check List | Bullish | Bearish | Neutral |
| Near 52-week High | YES | ||
| Volume | YES | ||
| Tick Volume | YES | ||
| Price Trend - Daily | YES | ||
| Price Trend - Long Term | YES | ||
| Price Daily Spread | YES | ||
| Base Structure | YES | ||
| Base - A-D | YES | ||
| Earnings-Quarterly | YES | ||
| Earnings-Long Term | YES | ||
| Earnings Outlook | YES | ||
| Industry Group | YES | ||
| Prior Breakout Success | YES | ||
| Fund Sponsorship | YES | ||
| Total Score | 12 | 0 | 2 |
(The “breakout List” gives all stocks breaking out of a base of five weeks or more. These stocks have a good chance to trend higher. However, a stop should be used to avoid those that do not work.
(Trading strategy: One should buy breakout stocks at breakpoint by using market order or stop buy)
Ticker Tape Digest’s Daily List of “Stocks To Sell or Sell Short” ranks stocks well timed to be sold immediately based on daily trading. The list can be used as an alert to reduce current long-term positions.
Shorts from tape action so far today - 4
Stocks Screened - 8,200
Long-Term Environment for bears: Unfavorable.
Bear Side - Only a few break down stocks today as market rallies strongly. Bears be selective.
(Trading strategy: These stocks can be sold short, or if held should be sold. If a stock is sold short, a protective stop buy should be placed. Short plays work best when the stock market is in a down trend.)
SIRF, based in San Jose, Ca., is a producer of semiconductor designs and software. Annual revenues: $248 million. SIRF falls sharply today after reporting earnings for the first quarter. The stock's gap drop today comes on volume of 8.8 million shares, almost triple its normal daily volume of 2.7 million shares. The stock is down about 2.86 so far.
SIRF reported for the first quarter a profit of 5 cents a share compared with a loss of 22 cents a share a year ago. The stock's reaction to the news was obviously bearish.
For the upcoming second quarter, analysts expect a 25% drop in profits to 15 cents a share from 20 cents a year ago.
SIRF's products, which employ global positioning system (GPS) data, allow manufacturers to add navigation and mapping, lost person location, and fleet vehicle tracking functions into their own wireless devices.
The fabless semiconductor company, founded in 1995, expanded its offerings through a 2002 agreement with Conexant Systems. Conexant contributed its own GPS technology to SIRF in return for an ownership stake in the company .
Technically, SIRF gaps lower today with heavy volume. The stock's TTD momentum indicator has moved into the bearish zone. The stock's accumulation - distribution line has turned down very bearishly today. TTD sees SIRF as a good trading play for bears. TTD is targeting the stock for a decline to 20 within the next few months.
TTD columnist Leo Fasciocco has covered the stock market for over 20 years. His articles appear in many publications. He is also a speaker at the Intershow conferences. He has been on television and radio. He is author of many educational articles about stock investing and the book “Guide To High-Performance Investing.”
For information to subscribe to the Ticker Tape Digest Services call: B. J. Owen at 1-480-926-1680. Distributed by Corona Publishing Enterprises. Ticker Tape Digest Inc. P.O. Box 2044 Chandler, Az. 85244-2044. TTD “Professional Report” is available on the World Wide Web: $100 per month. Password needed. “TTD Professional“ Faxed is $200 per month. The TTD Daily Report is $39.95. Credit cards accepted.
(The information contained has been prepared from data deemed reliable but there is no guarantee of complete accuracy. Ticker Tape Digest Inc. is not affiliated with any broker, dealer or investment advisor. Nothing in this publication constitutes an offer, recommendation or solicitation to buy or sell any securities. Further research is advised. This report is copyrighted and no redistribution is permitted with out permission. Some of the charts are from Telescan, Insight Trading, First Alert and other sources.)