Rockwell Automation (ROK) Trading In Tight Support/Resistance Range

Posted: Tuesday, November 24, 2009 9:21 AM EDT

Rockwell Automation (NYSE: ROK) closed yesterday at $44.29. So far the stock has hit a 52-week low of $17.50 and 52-week high of $46.72. Rockwell Automation stock has been showing support around 43.43 and resistance in the 45.55 range. Technical indicators for the stock are Bullish and S&P gives ROK a neutral 3 STAR (out of 5) hold rating. ROK appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at an Apr '10 40 covered call (ROK DH) for a net debit in the $38.09 area. That is also the break even stock price for this trade. This covered call has a 144 day duration, provides 14.00% downside protection and a 5.01% assigned return rate for a 12.71% annualized return rate (comparison purposes only). Rockwell Automation has a current annual dividend yield of 2.60%. [ATU-Seven Summits Research]

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