HOW TO WRITE COVERED CALLS - A REAL CASE STUDY!
==================================================================
PAGE #1 Date: Saturday, Feb. 08, 1997
The stock: ROSS STORES (ROST) Last traded at $44.00 up 1/2 on Fridays' close. 2 for 1 split - Record date Feb. 11, 1997! Will increase dividend also!
==================================================================
My Thinking Process:
1. I was reading my Investor's Business Daily (IBD) as usually while eating and drinking my coffee this morning. I noticed the name in an announcement about a 2 for 1 stock split set for record date Tuesday, Feb. 11, 1997 and the payment (split date) for March 05, 1997. Page A-21
I shop at Ross Stores all the time. My wife and I were just in one last week. Maybe I can make some of my money back!
2. Hummmm, let me check it out? What is their earnings per share (EPS) and relative strength (RS) I ask? AHHHHH, EPS of 94 and a RS of 74-B and only a PE of 14. Man, that pretty cheap for nowadays! How about that! Let me check out the chart on this baby!
3. Any news, let me see?
Reuters Ross Stores raises dividend
-----------------------------------------------------------------------------------
NEWARK, Calif., Feb 6 (Reuter) - Ross Stores Inc said it
increased its quarterly dividend to $0.09 per share from $0.07.
The dividend is payable April 7 to shareholders of record
March 10.
REUTER
Rtr 10:53 02-06-97
Copyright 1997, Reuters News Service
-----------------------------------------------------------------------------------------------
02/07/97 **** Star Recommendation for Ross Stores ROST
02/07/97 ROST Ross Stores:
02/06/97 Ranking change to **** from *** - Price down, sales strong
02/06/97 UPGRADING ROSS STORES
12/31/96 INITIATING COVERAGE OF ROSS STORES
12/31/96 INITIATING COVERAGE OF ROSS STORES
11/07/96 ROSS STORES ROST UP 2 to 48... Posts 17% higher October same store sales, 23% higher total sales.
END OF PAGE #1 CONTINUE TO PAGE #2
********************************************************************************************
DISCLAIMER: The writer is presenting a real stock and a live ongoing case study. No recommendations or endorsement to actually buy this stock are suggested nor implied. Trading stocks and buying calls should not be attempted without first understanding the risk/rewards of this type of investment!
The writer assumes no responsibility for the opinions being expressed!
Buyers always be aware!
******************************************************************************************** |
