Schaeffer's Trading Floor Blog

Highs & Lows: US Airways, Arch Coal, and Joy Global

LCC and GET tagged new 52-week peaks, while ACI, JOY, WIN, and CHRW are exploring new lows

by 5/31/2012 1:39 PM
Stocks quoted in this article:

U.S. stocks were last seen battling back to breakeven, though the major indexes are still on pace to end in the red for the first month in eight. Against this "Sell in May and go away" backdrop, we find new lows easily outpacing new highs on Wall Street today.

At the NYSE, 114 stocks have fallen to new annual nadirs, compared to 21 equities notching 52-week peaks. At the Nasdaq, 69 securities have tagged new lows, compared to 18 in fresh-high territory. Among the names hitting technical milestones are US Airways Group, Inc. (LCC), Gaylord Entertainment Company (GET), Arch Coal Inc (ACI), Joy Global Inc. (JOY), Windstream Corporation (WIN), and C.H. Robinson Worldwide, Inc. (CHRW).

Notable Stocks at Annual Highs

  • Among the elite is US Airways Group (LCC - 12.78), which tagged a four-year high of $12.90 thanks to a bullish brokerage note from UBS. Specifically, the analysts upped their price target on the stock to $16 from $14 and reiterated their "buy" endorsement, projecting strong near-term revenue trends for the domestic airline industry. Currently, eight out of 10 analysts already consider LCC a "buy" or better. Plus, as a result of the stock's year-to-date surge of more than 150%, its Relative Strength Index (RSI) sits at a lofty 74 -- in overbought territory.

  • Gaylord Entertainment (GET - 36.93) soared as high as $38.76, after Marriott International (MAR) agreed to pay $210 million for its namesake hotel brand and management operations. Despite outperforming the broader S&P 500 Index (SPX) by 23% during the past 60 sessions, short interest still represents more than seven sessions' worth of pent-up buying demand, at GET's average pace of trading. Going forward, an unwinding of bearish bets could translate into a contrarian boon for the security, which has tacked on 53.3% in 2012.

Notable Stocks at Annual Lows

  • On the flip side, Arch Coal (ACI - 6.29) fell to a 12-year worst of $6.29, no thanks to a new "neutral" rating from Global Hunter Securities. Over the past 52 weeks, the security has shed 78%, and has underperformed the SPX by 41% during the past three months. However, eight out of 20 analysts maintain "strong buy" opinions, leaving the door wide open for downgrades to pressure the stock even lower.

  • Joy Global (JOY - 55.84) tumbled to a near two-year low of $53.26, after cutting its full-year earnings outlook and projecting flat revenue over the next few quarters. Again, though, a capitulation by the bulls could exacerbate the stock's decline; currently, 12 out of 17 analysts maintain "buy" or better opinions, with not a single "sell" rating in sight.

  • Windstream (WIN - 9.27) dipped to a two-year nadir of $9.17, after the firm announced plans to cut about 375 to 400 management positions. The shares of WIN are now on pace to end May 17.6% lower, thanks to an earnings-related bearish gap earlier this month. However, the equity's RSI of 23 rests in oversold territory, suggesting the stock could be due for a respite in the short term. Nevertheless, the options crowd is betting on an extended retreat, as the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.07 stands just five percentage points from an annual acme.

  • Finally, C.H. Robinson Worldwide (CHRW - 58.46) retreated to $57.30 -- its lowest price since mid-2010, after analysts at FBR downgraded the stock to "market perform" from "outperform." Most of Wall Street is already in CHRW's bearish camp, though, with 18 out of 24 analysts doling out "hold" or worse ratings. Plus, short interest spiked 20% during the most recent reporting period, and now represents four sessions' worth of pent-up buying pressure.

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