Born to Be Wild
March 29th, 2007 by Buck Woodford
In stocks, there’s no such thing as “perfect” but this is about as good a setup chart as you’lll find. I’d thought this one would hold off and be a great play on the leadup to the 2007 NFL season. Perhaps March Madness is madder than usual at their stores this year?
Regardless, Buffalo Wild Wings (BWLD) posted 77 cents EPS in the 4th quarter 2007 vs 30 cents for Q4 2006. The reaction is marked on the chart. It still took several weeks before the multi-month resistance level at $58 was taken out. An “Earns+” chart (stock trading above last earnings announcment day), huge upside volume breakout, chilling out for 2 days as the gains held, and a full 1.7 mil of the 7 mil share float sold short (24% short interest) all point toward a potent situation.
This has the makings of a huge move and I’m looking forward to owning BWLD. Risk-wise, ManyPeaks accounts will stop out (on at least part) if it looks to close below 60.25, as that would negate the high volume move on Tuesday. Thus we’ll be accepting about $2.50-$3 worth of potential downside.
None, yet
