CH Robinson Worldwide (CHRW) PriceWatch Alert for November 3, 2009

Posted: Tuesday, November 03, 2009 8:25 AM EDT
By: Market Intelligence Center Staff

CH Robinson Worldwide (NasdaqNM: CHRW) closed yesterday at $55.43. So far the stock has hit a 52-week low of $37.36 and 52-week high of $61.69. CH Robinson Worldwide stock has been showing support around 54.16 and resistance in the 56.64 range. Technical indicators for the stock are Bearish and S&P gives CHRW a very positive 5 STAR (out of 5) strong buy rating. CHRW appears on the Investors Observer Momentum Plays list. For a hedged play on this stock, look at a Jan '10 55 covered call (CJQ AK) for a net debit in the $52.53 area. That is also the break even stock price for this trade. This covered call has a 74 day duration, provides 5.23% downside protection and a 4.70% assigned return rate for a 23.19% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the CHRW Jan '11 30 Call (ZYV AF) and selling the Jan '10 55 call (CJQ AK) for a $22.85 debit. The trade has a 74 day life and would provide 4.65% downside protection and a 9.41% assigned return rate for a 46.00% annualized return rate (for comparison purposes only). CH Robinson Worldwide has a current annual dividend yield of 1.70%. [ATU-Seven Summits Research]