Ralcorp Holdings Inc. (RAH) 11/3/09 PriceWatch Alert Targets 5.54% Downside Protection

Posted: Tuesday, November 03, 2009 8:24 AM EDT

Ralcorp Holdings Inc. (NYSE: RAH) closed yesterday at $54.12. 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 53.37 and resistance in the 54.79 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 Mar '10 55 covered call (RAH CK) for a net debit in the $51.12 area. That is also the break even stock price for this trade. This covered call has a 137 day duration, provides 5.54% downside protection and a 7.59% assigned return rate for a 20.22% annualized return rate (comparison purposes only). Ralcorp Holdings does not pay dividends at this time. [ATU-Seven Summits Research]

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