Go To TTD's Pre-Market Opening Breakout Watch Stock Lists for Wednesday, May 6
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Go To TTD's Pre-Market Opening Breakout Watch Stock Lists for Wednesday, May 6 |
| Go to Video Show - "How to Make Money With Breakout Stocks" |
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Go to Video Show - "How to Make Money With Breakout Stocks" Go to Video Show -TTD Performance 2008 Long and Sh
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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 positions both as trades or for longer-term plays. These stocks
will do very well during bear markets or market corrections
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. TTD often suggests using stop buy orders to enter. It is very important to buy a breakout stock as close as possible to the break point. 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.
TTD also has special feature sections on Educational Tips on Investing.
To email Mr. Leo Fasciocco leo@tickertapedigest.com.For service, email Beverly Owen owen@tickertapedigest.com. TTD’s Tel: 1-480-926-1680.
Total Buy Breakouts so far today - 5
Stocks Screened - 8,200
Bull side - Small number of breakouts as stock market stages a modest rally. Market remains in up trend. Bulls continue to look for quality breakouts to enter.
(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
| TTD's Quality Rating of Stock - RHB - AVERAGE |
RHB, based in St. Louis, Mo., provides rehabilitation services to hospitals and skilled nursing facilities. Annual revenues: $743 million. RHB breaks out today after reporting better-than-expected earnings for the first quarter. The stock gaps out from a seven-week flat base on big volume. So far today, RHB is trading 601,720 shares, four times its normal daily volume of 162,000 shares.
TTD highlighted RHB as a breakout at our midsession show on the Web. 
RHB reported first quarter net soared 92% to 48 cents a share from 25 cents a year ago. The 48 cents topped the consensus estimate of 31 cents a share and also the highest estimate of 33 cents a share.
So, the earnings were a big upside surprise. TTD has noted that on a big upside earnings surprise, a stock can move higher off the news and continue higher for a few weeks as analysts boost their earnings outlook for the rest of the year. TTD sees that potential here.
RHB's stock gapped higher at the opening. It then trended sideways through most of the day and then gave back some near the close.
TTD's clip of the tape highlights a big block of 36,400 shares that crossed in the morning at $19.42. The trade came within a sequence started by an up tick from $19.40.
RHB operates in 1,400 hospitals in the U.S. The firm offers services through three primary operating segments: (1) inpatient and outpatient hospital rehabilitation services, (2) contract therapy services, and (3) freestanding rehabilitation hospitals.
TTD's performance chart shows RHB's stock appreciating 22% the past 12 months. That compares with a 38% drop in the S&P 500 index.
TTD's long-term chart shows RHB trading in range between 10 and 20. The stock is now trending higher and will challenge the upper part of the range. A push through 20 would be bullish. . 
RHB's daily chart shows the stock rallying from 13 to 18. It then formed a base. Today's breakout is impressive. It comes with a gap move to the upside and heavy volume - all characteristics of bullish earnings news.
The stock's accumulation - distribution line (bottom of chart) is in a strong up trend and affirms the stock's breakout today.
RHB's strong earnings in the first quarter should be followed by good results in the second quarter. The Street projects 2nd quarter net to be up 31% to 33 cents a share from 25 cents a year ago.
The company is benefiting from better than expected results from its skilled nursing rehabilitation services division. It said it continues to expect good results from the unit for the rest of the year.
For 2009, the Street is forecasting an 11% increase in net to $1.30 a share from $1.18 a year ago.
TTD believes earnings could hit $1.50 a share. a 27% gain in net. The stock currently sells with a price-earnings ratio of just 14 based on the $1.30 estimate. So, TTD sees RHB as being undervalued at this point.
Going out to 2010, the Street is forecasting a 15% to 20% gain in profits.
Strategy Opinion: TTD sees RHB with potential to continue higher off this breakout. We are targeting the stock for a move to 24 within the next few months. A protective stop can be placed near 17. TTD rates RHB a good intermediate-term play with potential to surprise further on the upside.
Sponsorship: Average. The largest fund holder is 3-star rated DFA US Small Cap Value Fund with a 3.5% stake. It has held its position steady. A key holder is 5-star rated Security Mid Cap Value Fund with a 1.3% stake. RHB has 18 million shares outstanding. Funds hold 4.7 million shares.
Insider Activity: Neutral. Some light selling by insiders recently, but not significant. Four analysts follow the stock, 2 have a buy, the same as three months ago.
Stock Performance Chart for 12 months with Quarterly Earnings Markers.
| TTD's Breakout Profile
Rating RehabCare Group (RHB) |
| 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 | 11 | 0 | 3 |
(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)
Charts of Breakout Stocks
| TTD's Quality Rating of Stock - BAP - BELOW AVERAGE |
| TTD's Quality Rating of Stock - WNR - BELOW AVERAGE |
| TTD's Quality Rating of Stock - HOC - 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 - 5
Stocks Screened - 8,200
Long-Term Environment for bears: Neutral
Bear Side - Selected medical stocks dominate TTD's short list today. Bears be conservative as market remains in up trend near-term.
(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.)
BVF, based in Mississauga, Ontario, is a drug firm that in-licenses and develops specialty drugs in the central nervous system category. Annual revenues: $757 million. BVF's stock fall sharply today undercutting key technical support. The drop comes after the company agreed to acquire the rights a drug Wellbutrin from GlaxoSmithKline. So far today, BVF is trading 3 million shares, four times its normal daily volume of 669,000 shares. 
The stock took a dive in the morning, had a slight bounce and then trended sideways the rest of the day saddled with its loss.
TTD's clip of the tape shows a big block of 58,100 shares crossing today on a down tick to $10.85 from the prior trade at $10.89. The trade was the largest of the day. It shows clear heavy institutional selling pressure.
BVF produces Topical herpes treatment Zovirax and Ultram ER for pain. The are the firm's leading products.
This year, analysts predict BVF will show a 21% drop in earnings to $1.18 a share from $1.49 a year ago. The next two quarters will be weak too. Net for the first quarter is expected to drop 29% and then in the second quarter fall 21%.
TTD's daily chart shows BVF cutting below key support at 10.40 today. The widening of the spread as it moves lower shows the urgency by investors to sell and get out. The heavy volume is a very bearish sign.
Strategy Opinion: TTD is targeting BVF for a decline to 7 within the next few months or sooner. A protective stop can be placed near 11.
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.)
