Agilent Technologies Inc. (A) 11/13/09 PriceWatch Alert Bullish Price Movement

Posted: Friday, November 13, 2009 8:06 AM EDT
By: Market Intelligence Center Staff

Agilent Technologies Inc. (NYSE: A) closed yesterday at $27.43. So far the stock has hit a 52-week low of $12.02 and 52-week high of $29.38. Agilent stock has been showing support around 27.06 and resistance in the 27.88 range. Technical indicators for the stock are Bullish and S&P gives A a positive 4 STAR (out of 5) buy rating. A appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Jan '10 26 covered call (A AU) for a net debit in the $25.07 area. That is also the break even stock price for this trade. This covered call has a 64 day duration, provides 8.60% downside protection and a 3.71% assigned return rate for a 21.16% 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 A Jan '11 5 Call (OAE AA) and selling the Jan '10 26 call (A AU) for a $20.34 debit. The trade has a 64 day life and would provide 7.62% downside protection and a 3.24% assigned return rate for a 19.00% annualized return rate (for comparison purposes only). Agilent does not pay dividends at this time. [FBB-Seven Summits Research]