Monday, September 13, 2010

MO Watch

Tobacco company Altria Group Inc. (MO) has gapped down today after a 6.6% rise over seven trading days. The decline, 41¢ at this point, comes as the stock goes ex-dividend for a 38¢ quarterly payout.
MO $23.42

Ex-div drops happen, always. The mark of a great stock is how quickly they overcome the drop.

In terms of fundamentals, MO is a mixed bag. The company is carrying a lot of debt, and the revenue has declined catastrophically compared to five years ago. However, with an 88% return on equity, what's not to like?

Technically, the signs are mainly aligned in a bullish direction. It's even difficult to take the fast stochastic seriously. The last three times it has moved into bear phase, the price barely dropped at all.

The trend is up, and a 6.5% dividend yield is hard to quarrel with.

On the Person's chart, today's drop brought the stock below the weekly pivot midline. MO has been in bull phase on Person's Proprietary Signal since Sept. 2.

Person's Table
ppspps openupper pivotlower pivot
MO $23.42 $22.60 sep2 $24.21 +3.4% $23.21 -0.9%

Reversal Levels
  • $23.94, +2.2% (swing high)
  • $23.42 <== You are here.
  • $22.90, -2.2% (20-day ma)
  • $22.26, -5.0% (swing low)
I last wrote about MO on Sept. 3 and Aug. 31.

Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment. No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.
  • pps - Person's Proprietary Signal.
  • psar - Parabolic Stop and Reverse
  • ma20 - 20-day moving average
  • ma200 - 200-day moving average
  • macd - Moving Average Convergence-Divergence
  • sto - Fast Stochastic
About the glance: The colors indicate the state of each signal.
  • trend: Determined by the 5-day moving average, green for up, red for down, yellow for sideways.
  • sto: green for bull, red for bear.
  • sto zone: green for overbought (80+), red for oversold (20-), yellow for neutral zone
  • psar, pps, macd: green for bull mode, red for bear.
  • macd trend: green for rising, yellow for sideways, red for falling.
  • neutral.
  • ma20, ma200: green for above the average by more than 1%, red for below the average by more than 1%, yellow for within 1% either side of the average.

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