Dollar Tree Stores (DLTR) 11/3/09 PriceWatch Alert With 4.82% Downside Protection

Posted: Tuesday, November 03, 2009 8:32 AM EDT

Dollar Tree Stores (NasdaqNM: DLTR) closed yesterday at $47.70. So far the stock has hit a 52-week low of $32.94 and 52-week high of $51.72. Dollar Tree stock has been showing support around 45.03 and resistance in the 49.15 range. Technical indicators for the stock are Bearish and S&P gives DLTR a positive 4 STAR (out of 5) buy rating. DLTR appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Feb '10 50 covered call (DTJ BJ) for a net debit in the $45.40 area. That is also the break even stock price for this trade. This covered call has a 109 day duration, provides 4.82% downside protection and a 10.13% assigned return rate for a 33.93% annualized return rate (comparison purposes only). Dollar Tree does not pay dividends at this time. [ATU-Seven Summits Research]

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