PetSmart (PETM) PriceWatch Alert for July 6, 2009

Posted: Monday, July 06, 2009 8:07 AM EDT

PetSmart (NasdaqNM: PETM) closed yesterday at $21.27. So far the stock has hit a 52-week low of $13.27 and 52-week high of $28.86. PetSmart stock has been showing support around 20.90 and resistance in the 21.78 range. Technical indicators for the stock are Bullish and S&P gives PETM a positive 4 STAR (out of 5) buy rating. PETM appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Jan '10 20 covered call (QPT AD) for a net debit in the $18.27 area. That is also the break even stock price for this trade. This covered call has a 194 day duration, provides 14.10% downside protection and a 9.47% assigned return rate for a 17.82% annualized return rate (comparison purposes only). PetSmart has a current annual dividend yield of 0.56%. [For more information on these strategies along with more details on possible risks go to www.iotogo.com/HPWAinfo]

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