Technical Take: LL & SAM

Below are the downside targets using Speed Resistance Lines [SRL] for Lumber Liquidator Holdings (LL) and Boston Beer Company (SAM) based on the work of Edson Gould.

Lumber Liquidator (LL) has declined from the peak of $119.44.  Gould’s SRLs suggest that from the peak price, LL has a conservative downside target of $53.68 and an extreme downside target of $39.81.

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On February 25, 2015, LL was unable to sustain a price above the ascending $53.68 level with a decline of over –17%.  Our best guess is that LL will decline to the ascending $39.81 level, which currently approximates $49.50 price.  Those interested in LL and willing to perform appropriate due diligence could engage in a three phase purchase plan beginning below $39.81, $31.64 and $23.47.  Investors, as opposed to speculators, should be willing to accept that there is no compensation for the wait when holding LL and that the decline to the ascending $23.47 level is a real risk.

Boston Beer Company (SAM) is the brewer of Samuel Adams beer and a multitude of other “craft” beers.  Today SAM declined –10% on an earnings miss.  Below is the SRL for SAM.

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Our expectations for SAM are not very high as the last time that the stock was able to achieve the conservative downside target of $70.13 was in 2011.  Since that time, SAM has faltered but not fallen.  In spite of this fact, we’ve outlined the conservative downside target of $180.12 and the extreme downside target of $107.99.  Investors should note that a decline to the ascending $180.12 level is an ideal buying target with a follow-up purchase below $141.25.  As with Lumber Liquidators, SAM is bet on growth in the stock price and not much else. 

The relative strength of each company (long-term viability) is what makes these stocks compelling and worth considering at the appropriate predetermined price.

Analyst Estimates: February 20, 2015

Below are the price projections based on analyst earnings estimates for the stocks on our recent U.S. Dividend Watch List dated February 20, 2015.  These estimates project the price change for the respective stocks in the next 12 months.  The stocks listed below are only a select group that was not shown on our January 19, 2015 or February 6, 2015 analyst estimates.

Transaction Alert

On February 23, 2015, we executed the following transactions:

Nasdaq 100 Watch List: February 20, 2015

Below are the seven Nasdaq 100 companies that are on our radar.  We will be adding to our current position in one of the stocks listed below.

U.S. Dividend Watch List: February 20, 2015

The market finished the week on a high note with the S&P 500 closing at all-time highs.  The blue chip Dow Industrial Average topped its all-time high as well, closing at 18,144.  The deal to extend Greece’s aid for four months may have been the catalyst but we believe that the market climbs a wall of worry.  Despite bullish market sentiment, our watch list contains 50 companies, suggesting that there is interal weakness in the market.  While not all fifty companies are worth considering, there are pockets of opportunity. Continue reading