Lubrizol (LZ) 11/23/09 PriceWatch Alert With 11.22% Downside Protection

Posted: Monday, November 23, 2009 8:44 AM EDT

Lubrizol (NYSE: LZ) closed yesterday at $74.89. So far the stock has hit a 52-week low of $23.57 and 52-week high of $76.52. Lubrizol stock has been showing support around 72.02 and resistance in the 76.40 range. Technical indicators for the stock are Bullish and S&P gives LZ a positive 4 STAR (out of 5) buy rating. LZ appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Mar '10 70 covered call (LZ CN) for a net debit in the $66.49 area. That is also the break even stock price for this trade. This covered call has an 117 day duration, provides 11.22% downside protection and a 5.28% assigned return rate for a 16.47% annualized return rate (comparison purposes only). Lubrizol has a current annual dividend yield of 1.63%. [ABR-Seven Summits Research]

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