Valspar (VAL) 11/3/09 PriceWatch Alert Up To 6.07% Downside Protection

Posted: Tuesday, November 03, 2009 8:37 AM EDT

Valspar (NYSE: VAL) closed yesterday at $25.53. So far the stock has hit a 52-week low of $14.47 and 52-week high of $28.60. Valspar stock has been showing support around 24.92 and resistance in the 26.02 range. Technical indicators for the stock are Bearish and S&P gives VAL a neutral 3 STAR (out of 5) hold rating. VAL appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Jan '10 25 covered call (VAL AE) for a net debit in the $23.98 area. That is also the break even stock price for this trade. This covered call has a 74 day duration, provides 6.07% downside protection and a 4.25% assigned return rate for a 20.98% annualized return rate (comparison purposes only). Valspar has a current annual dividend yield of 2.33%. [ATU-Seven Summits Research]

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