Hormel Foods (HRL) Trading In Tight Support/Resistance Range

Posted: Monday, November 23, 2009 9:08 AM EDT

Hormel Foods (NYSE: HRL) closed yesterday at $38.29. So far the stock has hit a 52-week low of $24.81 and 52-week high of $39.04. Hormel Foods stock has been showing support around 37.96 and resistance in the 38.88 range. Technical indicators for the stock are Bullish and S&P gives HRL a neutral 3 STAR (out of 5) hold rating. HRL appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Jun '10 35 covered call (HRL FG) for a net debit in the $34.09 area. That is also the break even stock price for this trade. This covered call has a 208 day duration, provides 10.97% downside protection and a 2.67% assigned return rate for a 4.68% annualized return rate (comparison purposes only). Hormel Foods has a current annual dividend yield of 1.97%. [ABR-Seven Summits Research]

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