Prime Stock Advisory Letter for November 3rd, 1998

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Position Statement: In our Prime Recommendation Letter we attempt to identify the recommendation with the highest probability of moving higher.  We recommend that stop orders be placed at the time of purchase,  and once the position has moved profitable we recommend a stop be placed a minimum of 3/8th above the purchase price and moved higher as the position moves higher.

Today's Comments:  The overall market moved sharply higher in what was a rather broad based rally.  The Internet issues were the biggest gainers on the day with a Yahoo! surging more than $10 yesterday.  Unless their is a major surprise in today's election results I expect the overall market to continue to move higher.  It is important that everyone who can does vote today and I am urging you to do so regardless of your political beliefs.  The Bottom Line:  The overall market should move higher.

Company:  Alaska Air Group, Inc.      Symbol: 'ALK'    Closing Price: $38.25/share.
YH: $62.56     YL: $26.00     EPS: $4.52    P/E: 8.4      Forecasted EPS: 4.53
Dividend: N/A       Yield:  N/A       Ex Dividend: N/A
Price Target:  $42.44 & then $47.375           Downside Stop:  $35.625
Options Recommendation: November 35 Calls,  Symbol 'ALKKG' @ $4.00/contract.

Company Description: This company is a regional airline based in Alaska.

Recent News:  10/28  Alaska Air Group begins nostop service to Mexico

Our Analysis: Alakska Air is a component of the Amex Airline Index 'XAL',  the Philadelphia Airline Index 'PLN',  and the S&P Transportation Index 'TRX'.  I have rated all three of these indices as moving higher from their current levels.  The shares of 'ALK' gapped higher on the open of trading yesterday.  They are currently in a strong upward trend.  This trend should carry the shares higher to $42.44/share.  If the shares close above that level then they should continue to move higher and test $47.375/share,  a former upside resistance point.
 

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