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PRIME
STOCK NEWSLETTER FOR October 15th, 2008 |
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 $0.375 above the
purchase price and moved higher as the position
moves higher. |
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Today’s Comments:
The overall market finished Tuesday slightly lower on a day that saw the broader market mixed. The was strength in the Banking, Insurance, Broker/Dealer, Natural Gas, Transports, Pharmaceuticals, and the Oil & Gas indices. There was weakness in the Interactive, High Tech, Internet, Retailers, Disk Drive Manufacturers, Biotech, Networking, Chemical, Cyclical, Consumer, Commodities, and Telecom indices. The market failed to provide the appropriate follow through in order to reverse the current downward trend. The Bottom Line: A trend remains in place until it is broken. The overall market should move lower.
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Sterling
Calendar for October 15th, 2008 |
Date |
Est.
Time |
Release |
For |
Briefing.com |
Consensus |
Prior |
10/15 |
8:30am |
Core CPI |
Sep. |
|
0.2% |
0.2% |
10/15 |
8:30am |
NY Empire St. Index |
Oct |
|
(10.0%) |
(7.4%) |
10/15 |
8:30am |
PPI |
Sep. |
|
(0.3%) |
(0.9%) |
10/15 |
8:30am |
Retail Sales |
Sep. |
|
(0.4%) |
(0.3%) |
10/15 |
8:30am |
Retail Sales - Ex. Auto |
Sep. |
|
0.1% |
(0.7%) |
10/15 |
10:00am |
Business Inventories |
Aug. |
|
0.4% |
1.1% |
10/15 |
10:35m |
Crude Inventories |
10/11 |
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10/15 |
2:00pm |
Fed's Beige Book |
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Date: |
Misc. Calendar: |
10/14 |
ADTRAN, Inc. 'ADTN' announce earnings before the open. Est. $0.35 |
10/14 |
Altera Corp. 'ALTR' announces earnings after the close. Est. $0.30 |
10/14 |
CSX Corp. 'CSX' announces earnings after the close. Est. $0.93 |
10/15 |
Intel 'INTC' announces earnings after the close. Est. $0.34 |
10/15 |
Johnson & Johnson 'JNJ' announces earnings. Time N/A. Est. $1.12 |
10/15 |
Pepsi 'PEP' announces earnings. Time N/A. Est. $1.18 |
10/15 |
Abbot Labs 'ABT' announces earnings before the open. Est. $0.77 |
10/15 |
AMR Corp. 'AMR' announces earnings before the open. Est. ($1.53) |
10/15 |
Delta Airlines 'DAL' announces earnings. Time N/A. Est. $0.01 |
10/15 |
eBay 'EBAY' announces earnings. Time N/A. Est. $0.41 |
10/15 |
JP Morgan Chase 'JPM' announces earnings before the open. Est. ($0.12) |
10/15 |
Piper Jaffray 'PJC' announces earnings before the open. Est. ($0.16) |
10/15 |
Wells Fargo 'WFC' announces earnings before the open. Est. $0.43 |
10/15 |
Coca-Cola 'KO' announces earnings before the open. Est. $0.77 |
The
full earnings calendar for this week can
be found (here) |
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Recommendation: Sell/Short
Weyerhaeuser Co. 'WY' |
Company:
Weyerhaeuser Co. |
Symbol: 'WY' |
Closing
Price: $46.56 |
Web: www.weyeraeuser.com |
YH: $78.00
YL: $43.45 |
EPS: ($0.97) P/E: N/A |
Shares
Outstanding: 211 Million |
Forecasted
EPS:.$0.68 |
Market Cap.:
$9.8 Billion |
|
Dividend:
$2.40 |
Yield: 5.0% |
Aver.
Daily Trading Volume: 2.8 Million Shares |
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Price Targets:
$38.04 and then $31.81 |
Upside Stop:
$47.67/share |
Options Rec.:
November $45 Puts @ $4.30/contract |
Options
Symbol: WYWI |
Additional
information on Weyerhauser Co. "WY'' can be found (here) |
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Company Description: Weyerhaeuser Company engages in growing and harvesting timber, as well as in the manufacture, distribution, and sale of forest products primarily in the United States and Canada. The company manages approximately 6.4 million acres of self-owned and 0.7 million acres of leased commercial forestland in the United States; and has renewable long-term licenses on 15.1 million acres of forestland located in 5 provinces in Canada. It manufactures and distributes softwood lumber, engineered lumber, hardwood lumber, structural panels, veneer, plywood, and other specialty products for wood products dealers, do-it-yourself retailers, builders, and industrial users, as well as for the manufacturers of furniture and cabinetry. The company manufactures fluff fiber, papergrade fiber, and specialty chemical cellulose pulp; liquid packaging board for the production of containers for liquid products; and newsprint publication papers. It also produces containerboard products used to manufacture boxes and other packaging; manufactures boxes and other packaging products; and recycles used packaging and paper, as well as offers Kraft bags and sacks, and other products, such as SpaceKraft and bulk packaging, inks and plates, and preprinted linerboard. In addition, the company engages in constructing single-family housing; developing residential lots for its use and for sale; and making residential real estate investments. It also exports its products to Europe, Japan, and other Pacific Rim countries. The company, formerly known as Weyerhaeuser Timber Company, was founded in 1900 and is based in Federal Way, Washington.
Chart updates daily |
A
full list of the news headlines
for Weyerhaeuser Co. "WY" can
be found (here) |
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Our Analysis: The shares of Weyerhaeuser Co. 'WY' set a new mult-year closing low on heavier than normal trading volume yesterday. In the process they completed an inverted cup pattern with a measured move to out lower price target of $31.81/share. Both of these are very bearish trading signals. The shares of 'WY' should continue to move lower and test $38.04/share, a point of downside support previously established on October 9th, of 2002. If the shares of 'WY' close below that level then they should continue to move lower and test $31.81/share. I see upside resistance on the shares of 'WY' @ $47.27/share, and have set our stops accordingly at $47.67/share. . |
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Stocks
Looking Higher |
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Stocks Looking Lower |
INTC, TXN, FCX, AMZN, PNC, LVS, USO, STX, RSH, SVU, EXPE, AEO, ASML, ADTN, |
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Yesterday's
Edition of the Prime Stock Newsletter |
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Sterling Investment Services may hold positions
in the securities recommended or may be providing
consulting services to the companies mentioned
within this report. |
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