MomentumOptionsTrading.com Weekly Wrap for 6/1/2014
11:30pm (EST)
1. Market Summary
2. Will Weibo (WB) Find its Way?
3. Earnings
4. Weekly Wrap Portfolio Update
5. Week Ahead
(To view the charts, please log into the Members Area and go to the Weekly Wrap Premium section.)
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1. Market Summary
The market was closed last Monday for Memorial Day that left Wall Street facing a Tuesday open and a short-covering rally. The bulls have done well on Terrific Tuesday’s for much of the year and returned to form following a push to all-time highs.
Wednesday’s action produced another fresh high on the S&P 500 but the other major indexes struggled with prior resistance levels. The bears got the win by taking 3 of the 4 major indexes lower but it would be short-lived.
Thursday return to positive territory was led by the S&P 500’s continued run to the moon but resistance held for the most part. The small-caps acted bullish but the blue-chips and Tech lagged.
Friday’s action was sluggish for much of the session before a late day revival gave the bulls a split with the bears and a May victory. (continued…)
The Dow gained 18 points, or 0.1%, to finish at 16,717 on Friday. The blue-chips traded to a high of 16,688 on Tuesday and gained 69 points but gave back 42 on Wednesday to settle at 16,633. I mentioned throughout the week I wanted to see a close above 16,700 and Thursday’s push into the bell ended with a peak to 16,698.74. The index opened lower on Friday and kissed 16,648 before a final hour rally to 16,721. I’m expecting my upside target from December of 16,800-17,000 to trigger this week of next. Support has been solid at 16,600 with backup at 16,400-16,350. For the week, the Dow advanced 111 points, or 0.7%, after starting at 16,606. The blue-chips are now up 141 points, or 0.9%, for 2014 (Dow ended 2013 at 16,576).
The S&P 500 added 3 points, or 0.2%, to settle at 1,923 to end the week. The index danced with my March 1,909 fluff target throughout Tuesday and reached an all-time intraday peak of 1,912. I have said there could be additional fluff to 1,925 on a close above 1,909 after predicting the run to 1,900 in December. Wednesday’s high reached 1,914 before a 2-point loss as the S&P closed at 1,909. This was a perfect clue 1,925 could trip and Thursday’s rebound to 1,920 all but confirmed higher highs. Friday’s back test to 1,916 set the stage for the run to 1,924 into the close. There could be additional fluff to 1,950-1,960 as long as fresh support at 1,909-1,900 holds. The S&P 500 came into the week at 1,900 and roared 23 points higher, or 1.2%, by Friday’s close. For the year, the index is higher by 75 points, or 4.1% (S&P 500 ended 2013 at 1,848).
The Nasdaq declined 5 points, or 0.1%, to close at 4,242 ahead of the weekend. The run past 4,200 on Tuesday was impressive as I mentioned it was a major hurdle the bulls needed to clear and the war they had to win. Tech zoomed more then 1% to finish at 4,237 and looked poised to clear 4,250. Wednesday back test to 4,225 was followed with a surge to 4,247.95 into Thursday’s close. Friday’s high reached 4,252 before a fade to 4,221. The action suggests another test to 4,300 is in the cards and my fluff target of 4,400-4,500 from December is still a possibility. I have warned last week another close back below 4,200-4,175 might suggest a top is in. The Nasdaq was at 4,185 coming into the week and soared 57 points, or 1.4%. Tech is higher by 66 points, or 1.6% year-to-date (Nasdaq ended 2013 at 4,176).
The Russell 2000 dropped over 5 points, or 0.5%, to close at 1,134 on Friday. The small-caps faced resistance at 1,140-1,150 coming into the week after clearing 1,125 on the prior Friday. Tuesday’s surge to 1,144 and close at 1,142 was textbook on the short covering rally with the Russell leading the way higher. Wednesday’s back test to 1,136 wasn’t worrisome as the low of 1,132 easily held support. Thursday’s rebound to 1,141 and close at 1,140 suggested another run at 1,150 was coming. However, Friday’s lower low at 1,130 needs to be watched. The bulls did push a fractional higher high than Thursday by reaching 1,141.73 but they failed to clear Tuesday’s high. Overhead resistance remains at 1,150 with 1,175-1,200 waiting in the wings. A close back below 1,125, and more specifically the 200-day MA, could also signal a short-term top is in. The Russell came into Tuesday’s open at 1,126 and gained 8 points, or 0.7%, for the week. YTD, the small-caps are still down 29 points, or 2.5% (Russell 2000 Dow ended 2013 at 1,163).
The S&P 500 Volatility Index ($VIX, 11.40, down 0.17) was basically flat throughout the week as resistance at 12.50 held. The VIX spiked to 11.84 shortly after the open on Tuesday but was in a steady decline afterwards and closed at 11.51. Wednesday’s peak reached 11.86 while Thursday and Friday tops were 11.82 and 11.70. Lower highs and lower lows throughout the week suggests a continued decline.
I continue to mention the VIX getting more attention as the slick talking pros weigh in on the 7-year lows but they continued to say all the wrong things. I have gone on record since last year saying the VIX could reach single-digits this year if the S&P 500 makes it to my yearend 2,100 target. I have also mentioned on Tuesday that it is too soon to tell if the VIX dips below 10 into June/ July or if it happens later in the year, or, if at all. A close above 12.50 might be healthy and would put get more chatter about the VIX going as this would be the first warning sign. However, I often talk about how charts get “stretched” and the bulls have room to 13.50 before I would get excited about the possibility of loading up on bearish positions.
For the second-straight year there was no sell in May and go away which is Wall Street’s answer for early vacations. Despite some end of the week weakness, the bulls used a 4-day rally to cement the monthly win.
The Dow started May at 16,580 and gained 137 points or 0.8% while the S&P came in at 1,884 and added 39 points, or 2.1%. The Nasdaq jumped 128 points, or 3%, after coming into May at 4,114 while the Russell 2000 advanced 8 points, or 0.8%, after rolling in at 1,126.
The biggest development from last week was the drop in 10-year bond yields which fell to 2.44% and is at levels not seen since last June. Below is a 2-year weekly chart showing a test to 2% is a real possibility.
The talking heads say the bond market is “smarter” than the stock market but I mentioned a few months ago there are a ton of slick-talking pros that have been on the wrong side of this trade for much of the year.
You can clearly see in the aforementioned chart the peak into December 2013 and the slow fade since. The theory goes as the yield drops, it is usually a good indicator that money is moving out of the market and into bonds. With the indexes pushing new highs again, this theory hasn’t worked.
I am not a “bond” trader so I haven’t fretted over the 10-year note because I play the market’s trend and not bond yields. However, it is still important to follow these developments. At some point, a continued drop in yields could hurt stocks but the charts (and the VIX) are much more reliable indicators than predicting how low yields can go.
Side note: The water-cooler talk is the “smart money” is saying that the drop in the 10-year treasury is really due to the decline of the Chinese Yuan and not money moving out of the market.
I like to use the Monday/ Friday closes to get a feel for if money is moving in or out of the market. There is a lot of chatter about the market hitting fresh highs on “low volume” but I ignore this noise as well.
The Friday closes in May were much better than April as the Dow is riding a 4-session Friday win streak. Monday’s have been positive 5-straight sessions. Since there was no Monday trading last week, it was good to see a second-straight up Tuesday.
I have talked about watching Tuesday’s recently as they have been bullish for much of the year. However, May’s action shows 2-out-of-3 triple-digit pullbacks with a 20-point gain sandwiched in between before last Tuesday’s 69-point pop for the Dow.
I have talked about a continued rally into mid-June and there are a number of events this week that could help or hinder this prediction.
First, is the 50th Annual Meeting of the American Society of Clinical Oncology (ASCO) being held in Chicago. The meeting kicked-off on Friday and will last through Tuesday. There are hundreds of companies that are presenting with lung cancer, leukemia, and immunotherapy being the hot topics. Any cure for cancer is always good news.
This could give the Biotech sector a continued lift following the drubbing in March and April. The Market Vectors Biotech Index (BBH, $90.62, down $0.15) cleared its 50-day MA last week after hurdling its 200-day MA the prior week. The index faces resistance at $93.50 and the 100-day MA but another death-cross is forming (red circles).
The other cool gathering is Apple’s Worldwide Developer Conference on Monday. While it would be nice to see them introduce a new toy, I’m more focused on the 7-for-1 Apple (AAPL, $633, down $2.38) stock-split. It has been funny seeing the analyst upgrades north of $700 in recent weeks but they haven’t mentioned the upcoming split. I will talk more about this in Monday’s Daily Midday Update as the option chains will become much more cheaper to trade but expect shares to be on the move this week.
(See my thoughts about how to trade options on stock-splits on Page 109 in my trading manual, How to Trade Options on Momentum Stocks).
There is also major economic news due out this week highlighted by the unemployment reports on Wednesday and Friday. The ECB meeting could also influence the market and geopolitical risks are an ongoing concern.
In the 12/29/13 Weekly Wrap these were my thoughts on the Dow:
“There is the possibility of the bulls pushing 16,800-17,000 by late January if they can clear 16,600 but a break below 16,200-16,000 would be bearish.” (End)
After struggling to clear 16,600 by mid-January, I warned of the pending pullback that pushed the index briefly below its 200-day MA by February as I have always said this is one of the hardest months to trade. However, I remained bullish as I said the market cycle would be bullish through April and possibly into May. Bingo.
For the S&P 500, I have said to remain bullish until 1,900 triggers, specifically 1,909, with additional fluff to 1,925.
My extended target for the Nasdaq in December was 4,400-4,500. The index triggered 4,344 in late March.
The Russell 2000 (or a fat finger) gave me an incredible clue just before Christmas. Here were my thoughts on December 23, 2013 at 2pm (EST):
“As the market continues to make a run at our yearend fluff targets, one interesting development was the action in the small-caps. We have been calling for the Russell 2000 to make a run past 1,150 and possibly up to 1,175 once the rally resumed and today’s OPEN surpassed those targets.
The Russell 2000 opened at 1,212.81 and kissed 1,213.49 in the opening minutes before coming back down to earth. The 5% move could have been a rebalancing act and either marks the high for the year or is one hell of a clue this level will be triggered in January.” (End)
This has been “erased” from the charts as well as historical data for the Russell 2000 but a story the financial news never really covers. After peaking at 1,182 and clearing 1,175 in January, the small-caps broke down like a rented mule. However, the market left me that one clue just before Christmas that 1,200 would trip and it did on March 4th.
The “divergence” I talked about before Wall Street knew what was hitting them has now left the flip-floppers and slick-talking pros feeling bullish again.
I have rambled a lot and there is much more to cover but let’s just see how the next few weeks play out. The market could get a “blow-off” top or is putting in a top and by mid-June all of my extended fluff targets could trigger, or not.
From here, it will be back to the yearly and monthly charts to see how the summer might play out but let’s roll with bullish expectations for the next 2 weeks as some of the hedge-funds play catch-up and start to chase for performance.
Of course, I have predicted much higher prices by the end of the year as my S&P 500 target is 2,100 (from late February). However, I gave myself some outs and said there could also be a blood in the street type selloff at some point this year. Any war will make this a reality and summers are hot and another drop below the major MA’s would not be good. Zombies do crazy things when the heat is on.
Futures are pointing towards a higher open Monday morning: Dow (+25); S&P 500 (+2): Nasdaq 100 (+2).
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2. Will Weibo (WB) Find its Way?
By Michael Bryant
Key of Technicals Used In Following Article
Social media is big in China. At the end of 2013, there were 618 million internet users in China. Still this is only 45.7% of the population versus a 79.0% internet penetration in Japan. Thus, China still has a lot of growth potential in internet users. About 91%, or about 562 million, of Chinese internet users have a social media account. There are many social media providers in the country, including Pengyou (owned by privately-held Tencent), Tencent Weibo, RenRen (RENN), Sohu Weibo (owned by Sohu (SOHU)), NetEase Weibo (owned by NetEase (NTES)), and Sina Weibo. When people say Weibo, they usually mean Sina Weibo. Sina (SINA) spun off Weibo in April, and it started trading on April 17, 2014. After reaching a high of $24 in its IPO, the stock (WB, $18.52, down $0.63) has cooled.
After the July 2009 Ürümqi riots, China shut down most of the domestic microblogging services. Many popular non China-based microblogging services like Twitter and Facebook were blocked from viewing ever since. Charles Chao, the CEO of Chinese internet giant Sina, took this as an opportunity. His corporation launched the tested version of Sina Weibo on August 14, 2009. Basic functions including message, private message, comment, and re-post were made possible in September 2009.
Two other Chinese internet portals, Sohu and NetEase, launched the beta versions of their microblogging sites in January 2010. On January 30, another internet portal Tencent started Tencent Weibo on March 5, 2010. Building on its instant messaging service QQ’s large number of users, Tencent Weibo attracted more registered users than Sohu Weibo and NetEase Weibo. All services have to comply with China’s censorship laws. Due to the strict internet censorship policy on microblogging, a number of Chinese microbloggers choose to make posts that contain sensitive contents on Twitter. Although Twitter has been blocked in China since 2009, most Twitter users in China can access the site using a virtual private network (VPN).
On April 7, 2011, Sina replaced the domain name t.sina.com.cn for its Weibo site to weibo.com. This made the microblogging site easier to find.
On April 9, 2013, Alibaba Group, the Amazon of China, announced that it will acquire 18% of Sina Weibo for $586 million with an option to buy up to 30% in the future. That means Alibaba valued Sina Weibo at $3.26 billion in 2013.
Weibo uses a format similar to Twitter with a maximum of 140 characters per post. Unlike Twitter, posts with links using some URL shortening services or containing blacklisted keywords are not allowed. Posts on politically sensitive topics are deleted after manual checking. However compared to other Chinese media formats, Weibo services are seen as allowing greater freedom of speech. Many Chinese officials also opened Weibo accounts as to give their own version of events.
On April 17, 2014, the company was spun off by Sina and offered 16.8 million shares at $17 a share, raising $286 million, before the bell. Sina maintained a 57% stake in the company. The offering, which was expected to sell 20 million shares, priced at the low end of the forecast range of $17 to $19. Shares opened for trading on NASDAQ stock exchange at $16.27, reached a high of $24.48, and closed at $20.24. Weibo generated $188 million in revenue in 2013 and had a 68% growth margin. Although that was up from $66 million and a 30% gross margin in 2012, there was concern it had already peaked in terms of growth.
Another threat that could derail the stock is the expected IPO of Alibaba Group later this year. Investors are expected to sell shares in other Chinese internet stocks to shore up cash ahead of the IPO, which is estimated to raise $20 billion for Alibaba.
On May 21st, Weibo reported 1st quarter results for the period ending March 31st.
- Revenue was $67.5 million, up 161% for the same quarter in 2013.
- Advertising and marketing revenues grew 176% year over year to $51.9 million.
- Net loss was $47.4 million, or -$0.31 per share, up 146% from a year ago.
- Non-GAAP earning was $0.03 per share, down 74% from a year ago.
- Monthly active users were 143.8 million, an increase of 34% year over year.
- Daily active users were 66.6 million on average for March, up 37% year over year.
- For the 2nd quarter, the company estimates net revenues to be between $74 million and $76 million, below analysts estimates of $78 million. Due to the lowered guidance, analysts lowered their forecasts and now expect -$0.03 per share on $75.12 million in the 2nd quarter.
Further, while Weibo has about 50% as many users as Twitter, it trades at about 20% the valuation of Twitter. Moreover, revenue expectations of $400 million for 2014 have it trading at 9.5 times future sales, while Twitter trades at a steeper 15 times multiple.
As mentioned earlier, Alibaba valued Weibo at $3.26 billion in 2013. Its monthly active users grew 34% from 2013. Thus, should shares be valued at $4.36 billion today?
At $18.52, the stock is below its target of $25.00 made by the 2 analysts recorded by Thomson/First Call. Both analysts have the same target price on the stock. Using a scale of 1.0 as a strong buy and 5.0 as a sell, the average rating of the stock was 2.0, unchanged from a week ago.
| Current Month | Last Month | Two Months Ago | Three Months Ago | |
| Strong Buy | 0 | 0 | 0 | 0 |
| Buy | 2 | 2 | 0 | 0 |
| Hold | 0 | 0 | 0 | 0 |
| Underperform | 0 | 0 | 0 | 0 |
| Sell | 0 | 0 | 0 | 0 |
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3. Earnings
The companies in BOLD, we are looking at as possible trades and we may list call or put options on them in our Daily Newsletter (subscription link). If they become official recommendations, we sent out Trade Alerts or include them in our 9am and 1pm updates that come out during the week.
Monday
After the Close: Guidewire Software (GWRE), Krispy Kreme Doughnuts (KKD), Loral Space/ Communications (LORL), Quiksilver (ZQK),
Verint Systems (VRNT)
Tuesday
Before the Bell: American Woodmark (AMWD), G-III Apparel Group (GIII), Measurement Specialties (MEAS), Village Super Market (VLGEA)
After the Close: ABM Industries (ABM), Ambarella (AMBA), Ascena Retail Group (ASNA), ePlus (PLUS), FuelCell Energy (FCEL), Jiayuan.com International (DATE), Mattress Firm Holding (MFRM), Rentrak (RENT), Smith & Wesson Holding (SWHC)
Wednesday
Before the Bell: Brown-Forman (BF.A/B), Cyberonics (CYBX), Hooker Furniture (HOFT), Hovnanian Enterprises (HOV), IXYS (IXYS), Jos. A. Bank Clothiers (JOSB), Leidos Holdings (LDOS)
After the Close: Bazaarvoice (BV), Casella Waste Systems (CWST), Five Below (FIVE), Greif (GEF), Mitcham Industries (MIND), PVH (PVH), RealD (RLD)
Thursday
Before the Bell: Bio-Reference Laboratories (BRLI), Cantel Medical (CMN), Ciena (CIEN), Isle of Capri Casinos (ISLE), J.M. Smucker (SJM), Joy Global (JOY), Layne Christensen (LAYN), MiX Telematics (MIXT), Quanex (NX), Titan Machinery (TITN), Transtechnology (BZC), UTi Worldwide (UTIW), Vera Bradley (VRA), Vince Holding (VNCE)
After the Close: Analogic (ALOG), Argan (AGX), ARI Network Services (ARIS), Comtech Telecommunications (CMTL), Cooper Companies (COO), Crossroads Systems (CRDS), Diamond Foods (DMND), IDT (IDT), Mad Catz Interactive (MCZ), OilDri (ODC), Piedmont Natural Gas (PNY), Rally Software (RALY), SeaChange International (SEAC), Thor Industries (THO), Urstadt Biddle Properties (UBA), Vail Resorts (MTN), VeriFone Holdings (PAY), Zion Oil & Gas (ZN), ZoeS Kitchen (ZOES)
Friday
Before the Bell: Hurco Companies (HURC), KMG Chemicals (KMG)
After the Close: None
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4. Weekly Wrap Covered Call Portfolio Update (Closing prices as of 5/30/14)
The Weekly Wrap Closed Trade Track Record for 2014 is 14-3, or 82% win rate (99-10, or 91% win rate, overall since the start of 2011).
Hercules Offshore (HERO, $4.54, down $0.01)
July 4.50 calls (HERO140719C00004500, $0.30, down $0.05)
Original Entry Price: $4.50 (5/30/14)
Lowered Price from Selling Options: $4.20
Exit Target: $7
Return: 7%Stop Target: $2
Action: I recommended shares of HERO at $4.50 on Friday while selling the July 5 calls for 30 cents to lower the cost basis to $4.20. If the trade is “called away” at $4.50 by mid-July the return will be 7%.
Near-term resistance is at $4.60 followed by $4.80 and the 100-day MA. Support is at $4.40 followed by $4.20.
Limelight Networks (LLNW, $2.18, down $0.12)
June 2 calls (LLNW140621C00002000, $0.40, down $0.05)
Original Entry Price: $2.16 (5/30/14)
Lowered Price from Selling Options: $1.76
Exit Target: $3
Return: 24%
Stop Target: None
Action: I recommended shares at $2.16 on Friday while selling the June 2 calls for 40 cents. This will lower the cost basis to $1.76. If shares are called away by mid-June at $2 the return will be 14%.
Support is at $2.15 followed by the 200-day MA at $2.05.
Apple could take a look at this company as it looks to build out its CDN network. Limelight has a market cap of just $214 million and would be a great acquisition target for Apple. There are litigation risks with this trade but I believe the potential to make a double-digit profit over the next month is there.
Coca-Cola (KO, $40.91, up $0.25) strangle option trade
June 41 calls (KO140621C00041000, $0.26, up $0.08)
Original Entry Price: $0.60 (4/24/14)
Exit Target: $1.20-$1.50
Return: -57%
Stop Target: None
June 40 puts (KO140621P00040000, $0.17, down $0.05)
Original Entry Price: $0.50 (4/24/14)
Exit Target: $1.20
Return: -66%
Stop Target: None
Action: Shares of Coca-Cola continue to trade in a tight range and the time premium is starting to erode. Shares still have a shot at clearing $41 and making a run at their 52-week high of $43. A close above $42.25 will be enough for this trade to break even.
To save some premium, if shares clear $41, close the June 40 puts this week. I will send out a Trade Alert if triggered.
The trade is at down -61%, overall.
Annaly Capital Management (NLY, $11.79, up $0.09) stock trade
Original Entry Price: $11.39 (4/24/14)
Lowered Price from Selling Options/ Dividends $11.39
Exit Target: $15
Return: 4%
Stop Target: $10
Current Dividend Yield: 10.2%
Action: Near-term resistance is at $12 and the 52-week high is north of $15. Support is at $11.50 but there is risk to $11. A quarterly dividend of 30 will be paid by the end of the month that will lower the cost basis to $11.09.
Kodiak Oil & Gas (KOG, $12.73, down $0.02) Stock Trade
Original Entry Price: $13.25 (4/14/14)
Lowered Price from Selling Options: $13.25
Exit Target: $15
Return: -4%
Stop Target: $10
September 15 calls (KOG140920C00015000, $0.40, flat) LEAP Trade
Original Entry Price: $.0.72 (4/24/14)
Exit Target: $1.45
Return: -44%
Stop Target: None
Action: The close above the 50-day MA last week was bullish and clears the way for a run at $13. Support is at $12.25 with backup at $12 and the 100-day MA.
Alexza Pharmaceuticals (ALXA, $4.51, up $0.04) Covered Call Trade
Sold June 6 calls (ALXA140621C00006000, $0.05, flat)
Original Entry Price: $5.53 (3/4/14)
Lowered Price from Selling Options: $5.03
Exit Target: $6+
Return: -10%
Stop Target: $3
Action: Shares cleared the first layer of resistance at $4.40 last week. A move above $4.60 should lead to a push towards the 100-day and 200-day MA’s. Support is at prior resistance ($4.40) followed by $4.30.
On 3/4/2014 I recommended buying shares at $5.53 and selling the June 6 calls for 50 cents to lower the cost basis to $5.03. If the shares are called away in mid-June at $6 the trade will make 20%.
Zynga (ZNGA, $3.45, up $0.04) Covered Call Stock Trade
Original Entry Price: $5.63 (3/4/14)
Lowered Price from Selling Options: $5.33
Exit Target: $6+
Return: -35%
Stop Target: $3
Action: There is risk to $3. A close above $3.50 would be slightly bullish.
S.A.C. Capital Advisors owns a 5.3% stake. Zynga has some new games coming out over the next few months including a slick new version of Zynga Poker. I believe the company is a takeover target based on the potential revenue poker could bring although Zynga doesn’t plan to monetize anytime soon. There is billions to be made if Zynga monetizes their poker app.
On 3/4/2014 I recommended buying shares at $5.63 and selling the April 6 calls for 30 cents to lower the cost basis to $5.33.
Discovery Laboratories (DSCO, $1.87, up $0.03) Covered Call Trade
Sold June 3 calls (DSCO140621C00003000, $0.10, flat)
Original Entry Price: $2.42 (1/7/14)
Lowered Price from Selling Options: $2.02
Exit Target: $4.50-$5
Return: -9%
Stop Target: None
Action: The close above the 50-day MA would be bullish for a possible run up to $2.15. Support has moved up to $1.70.
On 1/7/2014 I recommended buying shares at $2.42 and selling the April 3 calls for 25 cents to lower the cost basis to $2.17.
On 4/30/14 I recommended selling the June 3 calls for 15 cents to lower the cost basis for the trade to $2.02. If shares are “called-away” at $3 in mid-June the trade will make 50%.
Pizza Inn Holdings (PZZI, $6.05, down $0.09) Stock Trade
Original Entry Price: $8.10 (10/11/13)
Lowered Price from Selling Options/ Dividends: No options available
Exit Target: $12+
Return: -25%
Stop Target: $5
Action: Pizza Inn recently reported better-than-expected earnings and it appears a bottom may have formed at $5.50-$5.75 if $6 fails to hold. Another symmetrical triangle is forming and a close above $6.75 could lead to a powerful move.
The company recently added 10 more units into their mix and now has 160 Pie Five shops opening this year and is expanding rapidly. I believe this will be a $15-$20 stock in 1-2 years and insiders and mutual funds own nearly 40% of the company. I have already recommended 2 profitable trades when shares were near $3.
Trades on HOLD (7): AKS Steel Holding (AKS), DryShips (DRYS), Rambus (RMBS), Bebe Stores (BEBE), Vivus (VVUS), Dendreon (DNDN), Galena Biopharma (GALE) LEAP Trade/ Stock Trade.
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5. Week Ahead
Here is a chart of the events for the week ahead:
