Monday, September 15, 2014

Monday's Finalists: NE, KMI

Two energy companies, the offshore drilling contractor Noble Corp. (NE) and the pipeline company Kinder Morgan Inc. (KMI), are the finalists from Friday's market session. KMI came from the supplemental list of potential large-cap bear plays, and NE also produced a bear signal.

Altogether, 32 bull and bear signals survived my early analysis from the regular lists, including five from the large-cap bears supplemental. (See "Monday's Prospects".)

Three failed confirmation by moving back within their 20-day price channels: SCTY, BPFH, and NPTN. The rest either had problems with their options -- too illiquid or too wide a spread -- or had charts that were insufficient to support their signals.

Both NE and KMI have neutral ratings from Zacks Investment Research, the service I use to short-cut my fundamental analysis.

NE's chart is slightly more bearish than KMI's, and if I had to choose then I would probably consider NE for a trade.

However, both also have dividends that are quite high, 5.78% annualized at today's prices for NE and 4.58% for KMI.

I consider a bear play on a high-dividend stock to be a waste of resources -- bear positions can't collect the income.

For that reason, I've decided not to do further analysis on NE or KMI, nor to add them to the Watchlist.

I shall instead spend the day bringing up a new platform for my data analysis, the former one, a Lenovo ThinkPad T520 portable work station running Microsoft Windows 7, having experienced a catastrophic failure over the weekend after several small-scale failures that interrupted my analysis and that I had wrongly blamed on the electric power company.

The new home for my data work is a Utilite Cortex A9 computer, made by the Israeli company CompuLab and running Ubuntu Linux.

-- Tim Bovee, Portland, Oregon, Sept. 15, 2014


My shorter-term trading rules can be read here. My longer-term trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here.

Tim Bovee, Private Trader tracks the analysis and 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 decisions for his or her own account, and take responsibility for the consequences.

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