National Semiconductor (NSM) 10/26/09 PriceWatch Alert With 11.33% Downside Protection

Posted: Monday, October 26, 2009 8:34 AM EDT

National Semiconductor (NYSE: NSM) ended the last trading session at $13.68. So far the stock has hit a 52-week low of $9.02 and 52-week high of $16.20. National Semiconductor stock has been showing support around 13.20 and resistance in the 14.54 range. Technical indicators for the stock are Bearish and S&P gives NSM a positive 4 STAR (out of 5) buy rating. NSM appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Feb '10 13 covered call (NSM BM) for a net debit in the $12.13 area. That is also the break even stock price for this trade. This covered call has an 117 day duration, provides 11.33% downside protection and a 7.17% assigned return rate for a 22.38% annualized return rate (comparison purposes only). National Semiconductor has a current annual dividend yield of 2.27%. [ABR-Seven Summits Research]

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