Monday, May 04, 2009

Weekly Stock Pick

Buy Sell Hold
The Week in the Markets

As I scan the stock charts looking for a technically low-risk high-reward trade setup I’m reviewing the market happenings this week. Bank of America is looking to raise $10 billion in capital, AIG is trying to sell its Japanese operations, the Boston Globe maybe going out of business, Obama is looking to end tax breaks for offshore companies, and East Asia is setting up a $120 Billion emergency crisis fund to name a few.

My Weekly Stock Pick

This Monday morning I’m looking at a lot of possible short-sell candidates in the semiconductor chip sector. Maybe they are showing up because last week’s chip sales reported a 30% decline from a year ago. Deteriorating chip demand maybe around for awhile more, but selective chip stocks may be good buy candidates at these valuations longer term. For now, I’m putting a short sell on one big chip maker. Of all the 20 most profitable tech stocks, this one ranks 14th. I’m a buyer at lower prices.

Short-Sell Applied Materials. Ticker AMAT

Sell Entry: 11.89 to 12.69

Stop-Loss: 12,70 and Higher

Take Profit Areas: 11.30, 10.71, 10.12

Applied Materials Company Profile

Applied Materials, Inc. designs, manufactures, and sells semiconductor fabrication equipment worldwide. The company’s Silicon segment provides a range of manufacturing equipment used to fabricate semiconductor chips or integrated circuits. It offers systems that perform primary processes used in chip fabrication including: atomic layer deposition, chemical vapor deposition, physical vapor deposition, etch, rapid thermal processing, chemical mechanical planarization, and wafer metrology and inspection, as well as systems that etch, clean, measure, and inspect circuit patterns on masks used in the photolithography process. Its Applied Global Services segment offers products and services designed to improve the performance and productivity and reduce the environmental impact of the fab operations of semiconductor, LCD, and solar cell manufacturers. The company’s Display segment provides equipment to fabricate thin film transistor LCDs for televisions, computer displays, and other consumer-oriented electronic applications. It’s Energy and Environmental Solutions offers manufacturing solutions for the generation and conservation of energy. This segment also provides manufacturing solutions for wafer-based crystalline silicon, and glass-based thin film applications to enable customers to increase the conversion efficiency and yield PV devices. In addition, the company offers roll-to-roll vacuum Web coating systems for high-performance deposition of a range of films on flexible substrates for functional, aesthetic, or optical properties, as well as large-area sputtering equipment for the production of low-emissivity and solar control architectural glass. It primarily serves manufacturers of semiconductor wafers and chips, flat panel liquid crystal displays, and solar photovoltaic cells and modules. Applied Materials, Inc. was founded in 1967 and is headquartered in Santa Clara, California.

Click here to review and Trial the Trading Software I used in determining my short position on Applied Materials.

Click the Applied Materials Stock Chart for a larger view.

Applied Materials Stock Chart