By Leo Fasciocco -- TTD
Ticker Tape Digest presents its daily stock market report containing stocks to go long as breakout trades, quick trades, or bargain trades. We also feature stocks under Significant Accumulation that are poised to breakout.
Ticker Tape Digest's
Daily schedule guide for TTD subscribers
1. Pre-market - check Breakout Watch List and Quick Trades.
2. Morning - (11:30 - 12 A.M.) - check breakout stocks tape and breakout chart slide show.
3. Midday (1 P.M.) check TTD Midsession Report and see market video show.
4. After close (4 P.M.) check final TTD Report for day.
Aggressive Investors Bullish - "Breakout Stocks" - ideally suited for bull markets and special situation stocks. Potential for large returns. (See Performance)
Aggressive Investor Bullish- "Quick Trade Stocks" -ideally suited for entry into top performing issues looking for a small quick profit." (See Performance)
Conservative Investors "Bargain Buy Trades for the Long Term." Ideally suited for entry into top performing big cap stocks on pullbacks within overall up trend.(See Performance)
Aggressive Bearish Investors - "Breakdown Stocks" to Sell Short. Ideally suited for bear markets or market pull backs. Potential for large returns (See Performance)
The TTD report also contains stocks to short as breakdown plays and as bargain (swing trade) shorts.
Investors should tend to try to go with a strategy that fits with the stock market's trend, unless there is a special situation play.
TTD's Breakout Stocks - Long are most suitable for aggressive investors seeking ideal entry points into leading stocks, especially during bull markets. They can do extremely well in bull markets with gains of as much as several hundred percent.
These stocks can also do extremely well during strong market rallies, or if they are in a industry group that is performing very well. They tend to have strong earnings outlooks and are near new-52 week, or all-time highs.
TTD Quick Trade Stocks - Long These are leading issues that have pulled back in recent days, but could move higher soon. They are most suitable for Aggressive Investors willing to trade short term. These stocks will do extremely well during market advances. They have about 74% win rate. During market rally sequences the win rate is even higher. The return is small 3% to 8% in just a few days.
TTD's Bargain Buy Trades - Long - Long Term. These are for conservative bullish Investors These long-term buys are ideally suited for entry into stocks on pull backs within overall up trend. These stocks can give a good return long-term especially during a bull market.
TTD also presents Stocks To Sell or Sell Short. These issues are suitable for aggressive investors willing to take short positions both as trades or for longer-term plays. These stocks will do very well during bear markets or market pull backs.
TTD's Bearish breakdown stocks to sell short. These issues have potential to fall sharply. They often show a technical breakdown and also some fundamental business problem such as weak earnings.
TTD's multi-media updates include a slide-show that presents charts and analysis at midsession. Some times TTD presents feature analysis on stocks and the market. TTD uses Windows Media Files. (WMV).
TTD also presents a "Breakout Watch List" that is up dated daily. This list consists of key stocks in position to breakout. A close watch of this list can put you in the stock just as it breaks out. A good idea is to study the list and be ready to move into a stock quickly as it hits its breakpoint.
TTD often suggests using stop buy orders to enter. It is very important to buy a breakout stock as close as possible to the breakpoint. The idea is to get "elbow room" if the stock should follow through to the upside. This is very important in being successful in making big money with breakout stocks.
It is also essential to have a stop loss strategy for all stocks in which positions are taken. Not every stock will work as expected. It is important for investors to "police" their portfolios and avoid getting trapped in any bad positions.
Quality rating of breakout Two key factors: 1 - Stock near all-time in price or near a 52-week high. 2 - earnings growth current year is strong. The ideal play is a stock with an Above Average Quality Rating. The stock is near a new high and will have strong earnings. TTD's other ratings are Average and Below Average.
TTD also has special feature sections on Educational Tips on Investing.
To email Mr. Leo Fasciocco firstname.lastname@example.org.For service, email Beverly Owen email@example.com. TTD’s Tel: 1-480-926-1680.
Total Buy Breakouts so far today - 10
Overall Quality of Breakouts - Average
Stocks Screened - 8,300
Bull side - Good number of breakouts. However, one needs to be selective. Stock market holds in up trend with momentum still bullish.
(Put mouse on Dow chart to see Nasdaq chart)
Long Term Environment for bulls: Neutral
Market (Daily) - NYSE Bullish, Nasdaq Bullish
Market (Weekly) - NYSE Bullish, Nasdaq Bullish
Market (Monthly) - NYSE Bullish, Nasdaq Bullish
Ticker Tape Digest's
TTD's Quality Rating of Stock - RAX - ABOVE AVERAGE
RAX, based in San Antonio, Tex., provides internet hosting and cloud computing services. Annual revenues: $1 billion. RAX, a top performer, that TTD highlighted last week, breaks out today from a six-week flat base and hits a new all-time high. The company has been racking up big profits. It has been a star performer since coming public back in 2008.
So far today RAX is up nicely and clears its base around midday. RAX is trading 1.6 million shares. Its average daily volume is 1.9 million shares.
The stock rose steadily in the morning and peaked around noon. It then trended sideways around midday, and then backed off a bit late in the day.
RAX's tape action shows the recent block trades.
One can see the price for the blocks climbing from $56.47 to a peak of $57.61. That shows steady institutional buying interest, especially near the breakpoint. .
A key bullish block trade came around noon when a block of 3,932 shares crossed the tape at $57.37. That was up sharply from the prior block trade at $56.04.
Near the close a block 23,818 shares crossed at $57.27. That was down from the prior block at $57.32. So, there appears to be some institutional profit taking late in the day. So, one will need to be watch of the stock.
RAX offers its products under the Fanatical Support brand. The company’s services are sold to businesses in more than 120 countries.
RAX serves some 130,000 business customers and managed more than 66,000 servers, 2.1 million e-mail accounts, and 417,000 cloud hosting domains.
RAX's 12-month performance chart shows the stock appreciating 50% versus a 10% gain for the S&P 500 index.
RAX's long-term chart shows the stock coming public in 2008 and soaring from a low that year of $4.80 to a peak of $23.51 by late 2009. It pulled back to 15 in 2010, but has since moved sharply higher. The stock's push to a new high Monday is very bullish and could attract more buying..
RAX's daily chart shows the stock breaking out from a base at 45 in early February. It advanced to 56 and set up a smaller new flat base.
The breakout clears resistance on modest volume.
The stock's TTD momentum indicator (top of the chart) is solidly bullish.
The accumulation - distribution line (bottom of chart) broke out to the upside before the price of the stock. As TTD said previously that could indicate some underlying buying pressure on the stock and a good omen for bulls.
For 2012, analysts expect RAX to post a 43% gain in net to 79 cents a share from 55 cents a year ago. The stock sells with a price earnings ratio of 70. That is high. So, one needs to be watchful of the stock.
Going out 2013, Wall Street projects a 47% gain in net to $1.15 a share from the anticipated 79 cents a share for 2012.
Looking out to the first quarter of 2012, net is expected to surge 70% - an acceleration in quarterly earnings growth. The analysts are looking for 17 cents a share, up from 10 cents a year ago. The highest estimate on the Street is at 19 cents a share. RAX tends to top the consensus estimate by one to three cents a share.
Net for the second quarter should rise 42% to 18 cents a share from 13 cents the year before.
Strategy Opinion: RAX is a leading stock, performing well, and with a strong earnings outlook. It is a winner until proven otherwise.
TTD is targeting the stock for a move to 70. A protective stop can be placed near 54 after a breakout.
TTD rates RAX an average intermediate-term play due to its high p/e ratio. The stock has a beta of 1.45 versus 1.00 for the S&P 500 index.
Sponsorship: Excellent. The top four fund holders all have a 5-star rating. The largest fund holder is 5-star rated Wells Fargo Advantage Growth Fund with a 3.4% stake. It was a recent buyer of 690,000 shares. RAX has 131 million shares outstanding. Institutions hold 70% of the stock.
Insider Activity: Bearish. Insiders have been steady sellers of the stock.. Some exercised options at $19.51 and $14.91 and turned around and sold for about $53. Currently, 17 analysts follow the stock, 7 have a buy, down from 11 three months ago.
Stock Performance Chart with Quarterly Earnings Markers
Insider Activity - Buying in Green - Selling in Red
|TTD's Breakout Profile
Rackspace Hosting Inc. - (RAX)
|TTD Check List||Bullish||Bearish||Neutral|
|Near 52-week High||YES|
|Price Trend - Daily||YES|
|Price Trend - Long Term||YES|
|Price Daily Spread||YES|
|Base - A-D||YES|
|Prior Breakout Success||YES|
Charts of Selected Breakout Stocks
|TTD's Quality Rating of Stock - USAP - AVERAGE|
|TTD's Quality Rating of Stock - BOX - AVERAGE|
|TTD's Quality Rating of Stock - HTZ - AVERAGE|
|TTD's Quality Rating of Stock - SAIA - BELOW AVERAGE|
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 - 2
Stocks Screened - 8,300
Long-Term Environment for bears: Unfavorable.
Bear Side - Only two breakdown stocks today. Bears remain conservative and selective. Stock market remains in up trend.
CHU, based in Hong Kong, provides cellular, paging, long distance, data and internet services in China. Annual revenues: $31.9 billion. CHU's stock gaps below key technical support setting off a TTD short play. The stock is a big cap short trading play. So far today, CHU is trading 1.2 million shares. Its average daily volume is 973,000 shares.
TTD highlighted CHU as a short at our midsession video show on the Web Monday.
The stock gapped lower in the morning. It hit an intraday low of 17.08. The stock then trended sideways the rest of the day unable to mount a rally.
CHU's tape action shows the recent block trades. One can see the price for the blocks declining from $17.60 to $17.13. The steady decline in the block prices shows consistent selling by institutions.
A key bearish trade took place in the morning when a block of 29,582 shares crossed the tape at $17.21. That was down from the prior block trade at $17.66.
CHU operates in two business segments consisting of mobile services and fixed-line services.
It is engaged in global system for mobile communications and wideband code division multiple access cellular business in 31 provinces in China.
This year, analysts forecast a 52% rise in CHU's earnings to 37 cents a share from 24 cents a year ago.
CHU's daily chart shows the stock gapping lower from key technical support. The stock's TTD momentum indicator (top of chart) is now bearish.
Strategy Opinion: TTD sees CHU as a trading short. We are targeting the stock for a decline to 13.50. A protective stop buy can be placed near 18.20.
|TTD's Quality Rating of Stock -CHU - BELOW AVERAGE|
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.”
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(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.)