ACTION:

Set a Limit Order to sell to close HILL common stock at $9.75.

Dear Momentum Stocks Weekly Subscriber,

Shares of Dot Hill Systems (HILL) were surging 87% to $9.68 in after-hours trading last night following a report that the company would be acquired by Seagate Technology (STX).

The all-cash takeover offer is valued at $9.75 a share, which puts the deal near $700 million, and it will turn our current position in HILL into a nice double-digit gain today.

 

Dot Hill Systems (HILL, $5.18, down, $0.26)

Original Entry Price: $7.10 (5/21/2015)

Lowered Price from Selling Options: N/A

Exit Target: $9.75 (Limit Order)

Return: -27%

Stop Target: $4.50 (Stop Limit)

Action: Set a Limit Order to sell to close HILL common stock at $9.75. If triggered, the trade will make 37%.

I could also close this position today even if the Limit Order does not trigger, as the premium will be built-in on the open. The board has approved the merger, so I don’t believe a bidding war will erupt.

I will send out a Profit Alert at some point after the open if our Limit Order triggers or if I elect to close the trade for a little lower than $9.75.

 

All prices given in this update are current as of 8:00 a.m. EST.

I hereby disclose that I will be participating in the aforementioned trade(s). Every new Momentum Stocks Weekly recommendation is listed with the price at which I entered my own position. If the price is slightly different than my recommended entry or exit price when you receive the alert, don’t let that keep you from getting into or out of a trade. Occasionally, you might even get a better “fill” price than what is posted in the Open Trades and Closed Trades.

Trade on!

Signed

Rick Rouse
Editor
Momentum Stocks Weekly