Scotts Miracle Gro (SMG) 11/27/09 PriceWatch Alert Bearish Price Movement

Posted: Thursday, November 26, 2009 8:09 AM EDT

Scotts Miracle Gro (NYSE: SMG) closed yesterday at $40.93. So far the stock has hit a 52-week low of $24.89 and 52-week high of $44.25. Scotts Miracle Gro stock has been showing support around 40.16 and resistance in the 41.42 range. Technical indicators for the stock are Bearish and S&P gives SMG a neutral 3 STAR (out of 5) hold rating. SMG appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Jan '10 40 covered call (SMG AH) for a net debit in the $38.83 area. That is also the break even stock price for this trade. This covered call has a 50 day duration, provides 5.13% downside protection and a 3.01% assigned return rate for a 22.00% annualized return rate (comparison purposes only). Scotts Miracle Gro has a current annual dividend yield of 1.22%. [FBB-Seven Summits Research]

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