The Bull's Divine Wisdom

As much as the Bull loves to share stories from his non-stop action packed life, this blog is for stock picks and its time to get back down to business.

The Bull has talked about "short squeezes" many times before and basically for review, a short squeeze happens when a stock that has a large shares of their stock sold "short" gets some sort of catalyst(good news) and the stock jumps say 3-5%, the people who are short get scared and try to cover(meaning buy the stock) which causes the stock to go up another 3-5%, then more shorts get scared and this goes on and on until a stock jumps 30 or more percent. This is known as a short squeeze or squeezing the shorts.

Well here are the Bull's top nine short squeeze plays:

1. BRKR: Short interest ratio: 5 Insider Buying: $2M Bruker BioSciences Corporation engages in the design, manufacture, service, and marketing of analytical and life science systems and associated products worldwide.

2. CKR - Short interest ratio: 6 Insider Buying: $10M CKE Restaurants, Inc., through its subsidiaries, engages in the ownership, operation, franchising, and licensing of quick-service and fast-casual restaurants in the United States. It operates its restaurants primarily under the brand names Carl's Jr., Hardee's, and La Salsa. Trades for 8x EBITDA

3. GGP - Short interest ratio: 6 Insider Buying: $26.5M General Growth Properties, Inc. operates as a self-administered and self-managed real estate investment trust.

4. MFW - Short interest ratio: 6 Insider Buying: $12M M&F Worldwide Corp., which produces licorice products and provides check-related services, said in early May that its first-quarter profit fell on higher expenses. Trades for 10x EBITDA.

5. BSG - Short interest ratio: 6 Insider Buying: $1.7M Bisys Group Inc., which provides outsourcing services to businesses, said May 10th its fiscal third-quarter net income plunged from a year-ago period which included a large profit from discontinued operations. Trades for 9x EBITDA

6. TRN - Short interest ratio: 8 Insider Buying: $3.9M Trinity Industries, Inc., through its subsidiaries, provides various products and services for the transportation, industrial, construction, and energy sectors primarily in the United States. Trades for 9x EBITDA

7. NTRI - Short interest ratio: 10 Insider Buying: $8.7M Advancis Pharmaceutical Corporation engages in the development and commercialization of anti-infective drugs for the treatment various infectious diseases.

8. BABY - Short interest ratio: 11 Insider Buying: $3.3M Natus Medical Incorporated develops, manufactures, and markets neurodiagnostic and newborn care products.

9. VLNC - Short interest ratio: 15 Insider Buying: $2M Valence Technology, Inc. engages in the commercialization of phosphate-based lithium-ion rechargeable battery technology, known as Saphion.

These stocks are all being heavily shorted which means people believe these stocks should go down. Personally I believe only VLNC, and GGP are very dangerous plays. If you like risk and see a catalyst then these are your stocks.


PICKS FOR TOMORROW:

Here are 5 scientific picks based on the law of averages.

1. ARBA: Stock is down for three days in a row, in its history it has been down three days in a row 52 times and has come back with a positive day 40 of those times and the average one day return is 2.92%

2. CSCO: It is 37/47 in the same criteria with a one day return average of 2.38%

3. CIEN: 39/53 for average of 2.25%

4. ORCL: 36/53 for 1.72%

5. AMAT: 58/76 for 1.48%

What does this week have in store for us all?

It is a big week in many different sectors of the stock market and I will hold back from technical analysis but I will say I would be short in car manufactures like Ford(F), General Motors (GM) and Toyota(best ran in the world)(TM) as they report auto sales for march on Tuesday. Also watch out if you are in retail stocks. JC Pennies(JCP) lowering of their forecast is not a very good precursor for Target(TGT) and Wallmart(WMT) and other retailers who report same store sales on this thursday. To go along with these Best Buy(BBY) reports earnings this week and I think they will miss big time. I would have puts or be short. No one is buying technology these days, I think JC Pennies weak easter sales will transfer over to best buy and the rest of the group. Also Dell has an analyst meeting and this stock is so cheap it might be worth a look but HP(HPQ) is such a better computer maker and business I would not strongly look to hard into it.

It seems a large percentage of the commenter's are either short or long in the stock TMA and it is down 18% coming into Monday but I think this further delay they were granted on Saturday shows that the banks know the deal has to get done and this stock will be saved. I would not be short in this stock.

A lot of times the best way to predict the market is to copy the "whales" and "insiders" since it would seem that billion dollar hedge funds must get things right the majority of the time and therefore I bring you ten stock I see unusual option activity in(for the last week).


1. WM - Jan09 15 dollar put

2. MTG - Jan09 25 dollar call

3. SPY - Both Sept08 134 Call and Put(this means the stock will be volatile but people don't know which way, its called a long straddle and the person makes money as long as the stock does not stay at where it is).

4. PDE - OCT08 35 call

5. MSFT - JULY08 22.5 PUT(Bull does not agree)

6. AW - Jan09 - 10 dollar put.

7. MYGN - AUG08 40 dollar put

8. HPQ - AUG08 45 dollar put(Bull does not agree)

9. IBM - MAY08 135 call

10. AERG - JAN09 2.5 call, JAN09 5 call

Bull also has 6 stock upgrades that he agrees with:

1. X - Rating on US Steel (X) was raised to Buy, Merrill Lynch said. $150 price target. Estimates also raised, to reflect strong steel pricing. 100% vertical integration allos the company to better manage rising raw materials costs.

2. ADI - Goldman Sachs said it is upgrading Analog Devices (ADI) to Buy from Neutral based on strong position realtive to other analog stocks. See heavy exposure to instrial end markets as major positive. Price target upped to $34 from $28.

3. ISIL -Goldman Sachs said it is upgrading Intersil (ISIL) to Buy from Neutral based on new product cycle in notebooks, LCD DTV/displays and wireless handsets. Expect stock to fare better than peers during current downturn. Price target raised to $31 from $24.

4. LEH - Lehman (LEH) was upgraded from Hold to Buy, Citigroup said. $65 price target. Attractive buying opportunity, after being on the sidelines for a couple of years. Government support will likely stop any further liquidity-driven meltdown.

5. LLTC - Goldman Sachs said it is upgrading Linear Technology (LLTC) to Buy from Neutral. Positives include limited exposure to wireless handsets and consumer along with premier business model and adjustable spending. Price target pushed to $36 from $30.

6. MUR - Murphy Oil (MUR) was upgraded to Buy, Deutsche Bank said. $104 price target. Company is one of the most leveraged to rising oil prices. Deutsche Bank said it is upgrading MUR to a Buy rating due to higher oil price forecast. Target price now $104.




Two Penny stocks for people(I do not advise buying but if you wan't to, I own none of these for full disclosure)

1. REDE - Stock had a late drop off to 54 cents. RedEnvelope, Inc. operates as an online retailer of branded gifts in the United States. The company primarily offers jewelry, home products, men's and women's accessories, and new baby gifts through its catalog, Web store, and phone store. Its Web store enables customers to search gifts by recipient, occasion, category, and price point, as well as to register for the company's gift reminder service, sign up to receive email promotions, view order history, chat with a customer service representative, and request a catalog.

2. OCHT - stock is at 3.5 cents. Orchestra Therapeutics, Inc., an immuno-pharmaceutical company, focuses on the development of various products to treat autoimmune and infectious diseases. It offers NeuroVax, an immune-based therapeutic product, which is based on T-cell receptor peptide technology for the treatment of multiple sclerosis. NeuroVax is in Phase II clinical trails



The BULL