Schaeffer's Trading Floor Blog

Highs & Lows: Ameristar Casinos, Pinnacle Entertainment, Northern Trust, and Raytheon

ASCA, PNK, NTRS, and RTN enjoyed new annual peaks today

by 12/21/2012 1:37 PM
Stocks quoted in this article:

Despite hearing a bout of mostly upbeat economic data, Wall Street has been overrun by bearish traders, as the major equities markets endure sharp losses from the stalled U.S. budget talks in Washington. Against this backdrop, however, the number of stocks marking new highs is edging out those at new lows. The NYSE counts 51 peaks and 13 bottoms, including a downgrade-induced two-year worst for Herbalife Ltd. (NYSE:HLF - 28.08). Meanwhile, there are 16 tops and 10 lows over on the Nasdaq. Among the stocks charting notable moves are Ameristar Casinos, Inc. (NASDAQ:ASCA - 26.33), Pinnacle Entertainment Inc. (NYSE:PNK - 16.00), Northern Trust Corporation (NASDAQ:NTRS - 49.97), and Raytheon Company (NYSE:RTN 59.03).

  • Las Vegas-based casino operator ASCA rocketed roughly 20% today on word that it will be acquired by PNK for about $869 million. This news obviously bolstered the stock's technical picture, lifting its 2012 gain to roughly 53%. Earlier in the session, the shares pegged a near five-year acme of $26.59. PNK has also benefited from the news, rising almost 20% to its own new high of $16.31. Put activity had been on the rise for PNK in recent weeks, as the stock's 50-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) measures 1.34, which is just 2 percentage points shy of bearish annual peak.

  • Banking concern NTRS has turned in a solid performance on the charts this year. The shares tacked on 26% since January, which was underscored by their 10-month moving average. In fact, the equity touched the $50.26 mark this morning -- its best price since April 2011. Even higher prices could be on tap, should skeptics continue to hit the exits. Although short interest dropped 2.4% over the past two weeks, there is still more than five days' worth of pent-up selling pressure, which could translate into a contrarian tailwind for NTRS.

  • RTN announced that it penned a deal worth $254.6 million to deliver its Tomahawk Block IV missiles to the U.S. Navy in 2013. Investors applauded the contract and pushed the security to a more than two-year peak of $59.34. Although RTN has added a noteworthy 22% in 2012, this overall uptrend still can't convince the covering brokerages to fully endorse the stock. The defense firm has racked up five "strong buys," versus 10 "holds," one "sell," and one "strong sell." And today's multi-year high arrives more than two points above the consensus 12-month price target of $57.06. Elsewhere on the Street, the options crowd seems just as bearish. During the past two weeks, speculators on the ISE/CBOE/PHLX have bought to open 1.30 puts for every call. This ratio is in the 70th percentile of its annual range, signaling that traders on these exchanges have scooped up bearish bets over bullish at a faster pace than usual during the past couple of weeks. Plus, RTN's Schaeffer's put/call open interest ratio (SOIR) arrives at 1.15, indicating that puts outnumber calls among options slated to expire within three months.

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