Childrens Place Retail Stores (PLCE) PriceWatch Alert Shows Bullish Technicals
Posted on Wednesday, July 09, 2008 8:07 AM
Childrens Place Retail Stores (NasdaqNM: PLCE) closed yesterday at $34.11. So far the stock has hit a 52-week low of $14.92 and 52-week high of $46.45. Childrens Place Retail Stores stock has been showing support around 31.93 and resistance in the 35.85 range. Technical indicators for the stock are Bullish. PLCE appears on the Investors Observer Stocks In The News list. PLCE lost $1.10 (-3.12%) Tuesday as a Sterne Agee analyst downgraded the stock to "Hold" from "Buy." For a hedged play on this stock, look at a Sep '08 30 covered call (TUY IF) for a net debit in the $28.31 area. That is also the break even stock price for this trade. This covered call has a 73 day duration, provides 17.00% downside protection and a 5.97% assigned return rate for a 29.85% 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 PLCE Jan '09 17.50 Call (ZYT AW) and selling the Sep '08 30 call (TUY IF) for an $11.50 debit. The trade has a 73 day life and would provide 14.98% downside protection and an 8.70% assigned return rate for a 43.00% annualized return rate (for comparison purposes only). Childrens Place Retail Stores does not pay dividends at this time. [For more information on these strategies along with more details on possible risks go to
www.iotogo.com/HPWAinfo]