Scotts Miracle Gro (SMG) 11/3/09 PriceWatch Alert Up To 6.81% Downside Protection

Posted: Tuesday, November 03, 2009 8:34 AM EDT

Scotts Miracle Gro (NYSE: SMG) closed yesterday at $41.14. So far the stock has hit a 52-week low of $23.64 and 52-week high of $44.25. Scotts Miracle Gro stock has been showing support around 39.63 and resistance in the 41.99 range. Technical indicators for the stock are Bearish and S&P gives SMG a neutral 3 STAR (out of 5) hold rating. SMG appears on the Investors Observer Hedged Dividend Income list. For a hedged play on this stock, look at a Jan '10 40 covered call (SMG AH) for a net debit in the $38.34 area. That is also the break even stock price for this trade. This covered call has a 74 day duration, provides 6.81% downside protection and a 4.33% assigned return rate for a 21.36% annualized return rate (comparison purposes only). Scotts Miracle Gro has a current annual dividend yield of 1.21%. [ATU-Seven Summits Research]

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