Wednesday, September 3, 2014

Wednesday's Finalists: AIV, R, BLL

Three symbols made it to the final round of analysis of bull and bear signals from Tuesday's markets. All are bull signals: The real-estate investment trust Apartment Investment and Management Co. (AIV) of Colorado, the logistics company Ryder System Inc. (R) of Florida, and the metal packaging manufacturer Ball Corp. (BLL), also of Colorado.

(See "Wednesday's Prospects" for the first round of analysis.)

Two other symbols, RE and WCN, nearly made it into the finals, but in the end I tossed them because they were down in today's intraday trading. Momentum, toujours momentum.

Of the others,
  • Four failed confirmation: VRX, ENTG, LECO, and VG.
  • One potential bear play had insufficiently liquid options for use in constructing a position: HMIN.
  • The others all had charts that were insufficiently bullish to support bull positions.
The three survivors present a tough choice.

Their charts are equally bullish, having currently broken above resistance to new highs. All have bull rankings from Zacks Investment Research, the service I use as a window on the fundamentals and Street opinion.

On the negative side, each has average volume of under a million and open interest on options that is too low for use in building a leveraged and hedged position.

AIV, the real-estate investment trust, has a high dividend of 3.01%. It would go better as a longer-term play, but I am well exposed to real estate at present, so I set it aside.

Looking more broadly at the remaining pair of symbols, I see that R is in an industry ranked bullish overall by Zacks, and most its competitors have bullish rankings. BLL is in an industry ranked negative, with no competitors with a bull ranking.

A strong industry lends support to companies within it. That tilts me in favor of R, and I shall post a full analysis prior to the closing bell.

-- Tim Bovee, Portland, Oregon, Sept. 3, 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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