BB&T (BBT) PriceWatch Alert for February 9, 2010

Posted: Tuesday, February 09, 2010 8:40 AM EDT
By: Market Intelligence Center Staff

BB&T (NYSE: BBT) closed yesterday at $27.13. So far the stock has hit a 52-week low of $12.90 and 52-week high of $29.85. BB&T stock has been showing support around 26.66 and resistance in the 28.04 range. Technical indicators for the stock are Bullish and S&P gives BBT a positive 4 STAR (out of 5) buy rating. BBT appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Jun '10 27 covered call for a net debit in the $24.81 area. That is also the break even stock price for this trade. This covered call has a 130 day duration, provides 8.55% downside protection and an 8.83% assigned return rate for a 24.78% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the BBT Jan '11 17.50 Call and selling the Jun '10 27 call for a $7.78 debit. The trade has a 130 day life and would provide 6.82% downside protection and a 22.11% assigned return rate for a 62.00% annualized return rate (for comparison purposes only). BB&T has a current annual dividend yield of 2.23%. [ATU-Seven Summits Research]