Blog

I took Father’s Day off to spend time with Pops so there was no Weekly Wrap this week.  I’m playing catch-up this morning so I’ll do a quick review of what is happening over the next five days before getting into the trades.

 

As far as earnings, the big ones on Monday are Smith & Wesson (SWHC, $6.03, up $1.10) and Walgreen (WAG, $31.43, down $0.29).  S&W was up 20% on Friday after pre-announcing earnings and a deal to acquire Universal Safety Response, a privately held company.  I profiled the company back in March and it was good for a triple-digit return as we played the March 5 call options when the stock was at $4.43.  Two weeks later, the stock was at $5.67.  Click here for the Blog that ran in March.

 

The point with this one is I often say history repeats itself and with the company pre-announcing, we missed the trade.  These are great reminders and I was the one who actually missed it but you get the point.  Guess what?  The Smith & Wesson July 5 calls (UWJGA, $1.20, up $0.60) gained 100% on the news.  I couldn’t find a quote for the June 5 calls but they probably zoomed 1,000% or something crazy.  They were 7 cents out-of-the-money on Thursday and ended up over a $1 IN-THE-MONEY when they expired on Friday.  I don’t know if you go chasing the options but the 52-week high for the stock is $7.52 and there seems to be a call to the right to bear arms.

 

Tuesday’s earnings we get Apogee Enterprises (APOG, $12.73, down $0.27), Sonic (SONC, $8.90, up $0.17) and Kroger (KR, $21.46, up $0.04). 

 

Wednesday will be exciting as we get numbers from Bed Bath & Beyond (BBBY, $28.53, up $0.71), CKE Restaurants (CKR, $8.93, up $0.39), Darden Restaurants (DRI, $34.70, up $1.16), Monsanto (MON, $80.73, down $1.57), Nike (NKE, $56.70, up $0.40), Paychex (PAYX, $26.71, down $0.09) and Red Hat (RHT, $19.99, down $0.24).

 

Thursday brings Accenture (ACN, $31.74, down $0.28), ConAgra Foods (CAG, $18.76, down $0.20), Jackson Hewitt Tax Service (JTX, $6.75, down $0.10) and Palm (PALM, $13.93, up $0.87).

 

Friday we get KB Home (KBH, $13.41, up $0.22) and Shaw Communications (SJR, $17.07, up $0.33).

 

Futures were higher last night but took a hit this morning after the World Bank cut its 2009 forecasts for most economies.  The bigger news this morning is that Apple’s (AAPL, $139.48, up $3.60) CEO had a liver transplant two months ago and Wall Street is just now finding out about it.  The stock is down a buck in pre-market trading and this story will dominate the headlines today.

 

 

Rick Rouse