Ralcorp Holdings Inc. (RAH) Trading In Tight Support/Resistance Range Near Its 52 Week Low

Posted: Wednesday, October 28, 2009 8:57 AM EDT

Ralcorp Holdings Inc. (NYSE: RAH) closed yesterday at $54.64. So far the stock has hit a 52-week low of $50.81 and 52-week high of $71.45. Ralcorp Holdings stock has been showing support around 53.91 and resistance in the 55.97 range. Technical indicators for the stock are Bearish and S&P gives RAH a neutral 3 STAR (out of 5) hold rating. RAH appears on the Investors Observer Momentum Plays list. For a hedged play on this stock, look at a Dec '09 55 covered call (RAH LK) for a net debit in the $52.74 area. That is also the break even stock price for this trade. This covered call has a 52 day duration, provides 3.48% downside protection and a 4.29% assigned return rate for a 30.08% annualized return rate (comparison purposes only). Ralcorp Holdings does not pay dividends at this time. [WBA-Seven Summits Research]

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