The Dow dropped 50 points today on good volume.  The advance/declines were positive though.  Simply waiting for tomorrows employment numbers.  This is the first time we've had 2 days in a row down since the beginning of the month.  Still overbought on the stock indices so we'll need to see some more downside before another run higher or at least some sideways price movement.  We will have to see what the numbers are tomorrow and the markets reaction to them.  GE was flat on the day after being higher.  Volume was average.  My February GE calls are still positive but have lost some value.  I will probably dump them sooner rather than later.  Gold fell back today after yesterdays gains.  The precious metal futures lost $20.  The US dollar was a bit weaker as well.  The XAU was off 1 1/4.  ABX, GG and NEM all had fractional losses again on average volume.  My February ABX calls are almost worthless.  I doubt even the earnings report in a couple weeks can save this trade.  It was wrong from the start and I should have simply bailed out of the position the day after I bought it.  Mentally I'm feeling OK.  How much will tomorrows numbers matter?  Probably just a day or so.  This is a momentum rally and I would expect after we take a breather, the prices will head back higher.  Most likely moving up into the February option expiration.  After that, perhaps things will change.  Gold remains dead money.  Even bullish news doesn't do much except for a one day rally.  The gold shares have gotten pummeled.  How much lower can they go?  We'll get some rest tonight and it's on to the jobs number to wrap up the week.

The Next Big Growth Industry Like 3D Printing: Cosmetic Surgery Stocks

American are getting older but looking younger. According to recent data at the United States Census, persons over 55 years old now make up 25% of the population. According to an article published by Stony Brook University School of Medicine, 3.3 million Americans over the age of 55 underwent cosmetic procedures in 2010, and facelifts are up 14% just for men. The article emphasizes the fact that older Americans are turning to cosmetic surgery to compete in the job marketplace.

Innovative procedures in cosmetic surgery, and especially liposuction, have made huge advances recently. The procedure is now much quicker, safer, and with a much faster recovery period. Casey Research has published an outstanding report on the history of cosmetic surgery and the the latest technology in the field.

Will this industry be the next hot industry? Will the stocks in this field rise by 200% in a year like the 3D printing stocks? It is hard to know when revenues will start to skyrocket and investors will jump on the stocks in a narrow niche. There are about a half a dozen cosmetic surgery product companies in this business according to WallStreetNewsNetwork.com, and surprisingly, many of these companies are debt free with a lot of cash on a per share basis.

One of the leaders in the field is Cynosure (CYNO), which produces Smartlipo® LaserBodySculpting™ Workstations used for treating localized fat deposits using a minimally invasive technique, and makes three laser options that take different approaches to treat cellulite: Cellulaze, SmoothShapes XV, and Triactive. The company just released PicoSure, the first picosecond device to remove tattoos. The stock trades at 43 times trailing earnings and 30 times forward earnings. The company has $807,000 in debt, with $5.97 in cash per share. Revenues for the latest reported quarter ending September 30 were up 31.1%. The company reports year-end earnings on February 12 before the market opens.

Solta Medical (SLTM) produces the Thermage CPT non-invasive treatment for skin tightening, and the Liposonix system to destroy unwanted fat cells resulting in waist circumference reduction. The stock trades at 29 times forward earnings, has $27.8 million in debt, and $0.56 in cash per share, amounting to about 22% of the stock price. Revenue for the latest quarter rose by 27.8%. The company reports on February 19.

There are other companies that participate on a peripheral basis of the look-good, look-younger industry. For example, Align Technology (ALGN) makes the Invisilign systems, an invisible orthodontics process for straightening teeth. The stock has a trailing price to earnings ratio of 35 and a forward PE of 24. The company has no debt with $4.03 in cash per share.

PhotoMedex (PHMD) makes XTRAC laser products for psoriasis and vitiligo, NEOVA for premature skin aging, and Omnilux Light-emitting diode for wrinkles and acne. The stock has a PE of 19 and a forward PE of 10. It has $17,000 in debt, with $2.55 in cash per share.

To access a free list of of the cosmetic surgery stocks, and stocks in related industries, go to WallStreetNewsNetwork.com.The list includes the trailing PE, the forward PE, the total debt, the cash per share and the business.

Disclosure: Author did not own any of the above at the time the article was written.

By Stockerblog.com

Really, the market goes down too?  The Dow fell 44 points on average volume.  The advance/declines were about 2 to 1 negative.  GDP was weaker than expected and there was no new news from the Fed.  The stock indexes have been overbought for weeks.  Perhaps now we will see some decline/consolidation.  It is way overdue.  One day doesn't make a trend though.  We've still got to get through the employment report on Friday.  My thinking at the moment is that any decline will be bought.  Todays action may stop the climb of the summation index and that is something to keep an eye on.  GE fell 1/4 on light volume.  Perhaps $23 is not in the near future as I had thought.  My February GE calls are still in the black but by not as much.  I may have to consider getting rid of them if we get another run to $22.50.  The daily candlestick chart doesn't look so bullish after todays action.  Gold had a strong session, up $18 on the futures.  The US dollar was weaker.  The inverse relationship between the dollar and gold is back on track.  The gold shares continue to disappoint as the XAU fell 3/4.  It seems that nothing can get the gold shares moving to the upside.  ABX, GG and NEM all had fractional losses on good volume.  My February ABX calls are still very much in the red.  It appears that this trade will be a loser, barring an unforeseen spike in ABX.  2 days and 2 weeks left in the February option cycle.  The earnings for ABX are due the Thursday of expiration week.  I don't think I'll still be in the trade at that point but you never know.  Mentally I'm feeling OK.  Some weakness today in the stock indices but the rally still seems intact.  No trend lines have been violated and really, it is only one day of decline.  We will have to see how the rest of the week plays out.  There is no love for the gold shares as they continue to drift lower despite higher gold prices.  I have no idea when that will change.  The Gold/XAU ratio has been deep in the buy zone for weeks on end.  It just doesn't seem to work anymore.  It has certainly cost me money.  Overall I think tomorrow will be a holding pattern in the various marketplaces as we await the employment report.  We'll keep an eye on the overnight sessions and go from there.

Stock Tip of the Week: Short Puts

It may sound strange but shorting puts can be one of the safest ways to invest. Put and call options are ways of speculating on the price movements of stocks providing much greater percentage returns (and percentage losses). A call is the right to buy a stock at a particular price within a particular amount of time. The call purchaser hopes that the stock will go up and if it does, the percentage gain will be far more than if just the stock is purchased. If the call is not exercised by the expiration date, the call expires worthless. If you sell (short) a call and you own the stock, if your stock doesn't get called and the call expires worthless, you get to keep the proceeds, the premium, which is a way of generating income, or additional income if the stock is already a dividend payer, on the stock. Options are traded on a per share basis but representing 100 shares. In other words, If a call option is selling for 3.75, it means that the option cost would be $375 and it would give the buyer the right to buy 100 shares.

A put is the reverse. It is the right to sell a stock at a specific price within a particular period of time. Often, owners of a stock buy a put to protect them on the downside. There could be several reasons for this: postponing a capital gain to the following year, uncertainty about upcoming earnings call, belief in a potential market drop. Another reason to buy a put is to speculate that the stock will drop; an alternative to shorting the stock. However, the seller of a put is hoping that the stock will go up and the put will become worthless. If the stock drops, the price of the put will increase and the trader who shorts the put would lose money but would lose less money than if the stock was purchased.

This is where an overlooked trading technique comes in to play. Let's look at a hypothetical example. Suppose XYZ stock is trading at 21 a share. Assume that a one month put with an exercise price, or strike price, of 20 is selling at 1. The buyer of the hopes that it drops significantly. If the stock drops to 17, the put buyer can buy the stock at 17 and 'put' it to the seller of the put at 20, for a 3 point gross profit or after the investment of 1, a net profit of 2, not counting commissions. Or as a simpler alternative, the put would be worth 3 points and could just be sold, for a 200% profit.

Now let's look at the seller of the put. If you are bullish on XYZ stock, you can buy 100 shares of the stock for 21. If the stock does nothing, you make nothing. If the stock goes up 1 point to 22, you make a $100 profit. if it drops to 17, you lose $400. Now here's the tip. If you short the put, and the stock does nothing, the put will expire worthless and you make $100. If the stock goes to 22, the value of the put drops to zero still expiring worthless, and you make a $100 profit. Now suppose that the stock drops to 17, the put is now worth 3, and since it was shorted at 1, it is a net loss of 2 or $200, a much lower loss than if you had bought the stock.

The alternative is that you could have had the stock put to you, meaning that you would be forced to buy the stock at 20. But you would still have been better off than if you had just bought the stock at 21. You end up buying a stock that you wanted, but at a dollar less per share, plus you get to keep the one dollar premium so your cost basis is actually 19. This on a stock that you were willing to pay 21 for. Therefore, the breakeven is 19. If the stock drops drops to 19, the value of the put is 1 which is where you shorted it at.

If you really want the stock, there are other ways to play the short put. You could short an at-the-money or slightly in-the-money put, giving you a greater chance of getting put to, and still capturing the premium on the option.

This technique has the advantage of time in your favor. The closer to expiration, the faster the value of the put depreciates. Now the disadvantages. Unless the stock is put to you, you lose upside potential. Also, not every investor is eligible to do this. You would have to be cleared for option trading and spreads by your brokerage firm before you will be allowed to short puts. Also, it is really a good idea to have some experience trading options before trying this.

Higher and higher we go as the Dow gained 72 points on good volume.  The advance/declines were positive.  What more can I say?  The market doesn't go down anymore.  But we all know better than that.  The summation index continues higher.  GDP out tomorrow and the Fed statement.  That should get things moving perhaps.  It has been a great momentum run and there are no signs of it stopping at this point.  But it will eventually.  GE was flat on the day and the volume was light.  My February GE calls remain in the black.  I would still like to wait until GE hits $23 to cash out on this trade.  But nobody cab predict the future.  GE remains overbought.  Gold actually went up today.  The futures rose 7 bucks on a weaker US dollar.  The XAU was higher by 2 1/2.  ABX, GG and NEM all had fractional gains on good volume.  Could this finally be the bottom for the gold shares?  I certainly don't know but it could be the snap back attempt after the recent drop.  My February ABX calls are still solidly in the red.  This is a cut the loss trade now unless we see some big turnaround this week.  Doubtful.  Mentally I'm feeling OK.  The stock indices remain very overbought yet continue to move up.  You cannot fight price.  I have no idea how long this can last but it has certainly lasted longer than I expected.  Perhaps tomorrows data or the Friday jobs report will be the catalyst for a breather.  Gold is once again trying to hold on at its 200 day moving average at $1660.  We'll see.  A weak GDP plus an accommodating Fed should be positives for gold tomorrow if that is indeed the case.  We'll watch what happens overseas tonight and go from there.

Stocks Reporting Earnings Tomorrow, Tuesday, Jan 29

Stocks reporting earnings tomorrow, Tuesday, January 29.

AK Steel Holding (AKS)

Amazon.com (AMZN)

Broadcom Corp. (BRCM)

Corning Inc. (GLW)

Crane Co. (CR)

DR Horton (DHI)

Dolby Laboratories (DLB)

Ford Motor Company (F)

Harley-Davidson (HOG)

International Paper (IP)

Illinois Tool Works (ITW)

Peabody Energy (BTU)

Pentair (PNR)

Pfizer Inc. (PFE)

If you like lists like this, check out the many free stock lists at WallStreetNewsNetwork.com.

Stocks Going Ex Dividend the Second Week of February

  Here is our latest update on the stock trading technique called 'Buying Dividends'. This is the process of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend. This technique generally works only in bull markets. In flat or choppy markets, you have to be extremely careful, and may need to avoid the technique during those times.

In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can't sell the stock until after the ex date. The actual dividend may not be paid for another few weeks. WallStreetNewsNetwork.com has compiled a downloadable and sortable list of the stocks going ex dividend during the next week or two. The list contains many dividend paying companies, all with market caps over $500 million, and yields over 2%. Here are a few examples showing the stock symbol, the ex-dividend date, the yield, and the market capitalization.

FirstEnergy Corp. (FE) 2/5/2013 5.51% $16.8B

Intel Corporation (INTC) 2/5/2013 4.30% $104.3B

Rentech Nitrogen Partners LP (RNF) 2/5/2013 8.51% $1.8B

Summit Midstream Partners LP (SMLP) 2/5/2013 7.89% $1.0B

American Electric Power Company, Inc. (AEP) 2/6/2013 4.25% $21.6B

Belo Corp. (BLC) 2/6/2013 3.91% $766.1M

Unilever plc ADR (UL) 2/6/2013 3.15% $51.5B

Unilever N.V. ADR (UN) 2/6/2013 3.16% $51.7B

Oritani Financial Corp. (ORIT) 2/6/2013 3.73% $701.2M

The additional ex-dividend stocks can be found at wsnn.com. (If you have been to the website before, and the latest link doesn't show up, you may have to empty your cache.) If you like dividend stocks, you should check out the high yield utility stocks and the Monthly Dividend Stocks at WallStreetNewsNetwork.com or WSNN.com.

Dividend definitions:

Declaration date: the day that the company declares that there is going to be an upcoming dividend.

Ex-dividend date: the day on which if you buy the stock, you would not be entitled to that particular dividend; or the first day on which a shareholder can sell the shares and still be entitled to the dividend.

Monthly Dividend Stock List
Record date: the day when you must be on the company's books as a shareholder to receive the dividend. The ex-dividend date is normally set for stocks two business days before the record date.

Payment date: the day on which the dividend payment is actually made, which can be as long at two months after the ex date.


Don't forget to reconfirm the ex-dividend date with the company before implementing this technique.

Disclosure: Author did not own any of the above at the time the article was written.

By Stockerblog.com