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The Hershey Company - Sweet Returns (UPDATED with option strategy) 
Wednesday, January 24, 2007
By Mickey Schoenhals
Recommendation: MarketHistory President Tony Kolton adds, on his blog3, "The stock is down over $1.87 at this writing to $50.50. I view this as a buying opportunity... You can buy the stock with a stop loss of $47.79, and risk a few points, or if you want more leverage, I’d buy the August 55 calls, currently trading at $1.15. I think by August HSY could touch $60 and then these calls would be worth around $5."
The Hershey Company (HSY) shares have been very strong of late rallying 7 of the last 8 trading days for a gain of 4.1% and closed at $52.37. Earnings Report for Hershey comes out today, and has been very good news in past January's. Click here4 for the full EarningsEdge analysis for Hershey.
Q: How has HSY responded to earnings reports in January?
A: According to the 14 previous occurrences of this event omitting any repeat occurrences within 10 trading days, EventEdge indicates that HSY has shown a strong bullish edge that peaks 18 trading days after the event. HSY rallies in 100% of the cases (14 of 14) by an average of 6.3% relative to the close on the event date.
Mickey Schoenhals5 is an analyst with Markethistory.com.
 |
Let variable values:
@ = GII.HSY.NYSE
theEvent = IF EPS_date ( @ )
AND
Date is January
THEN 1
ENDIF
Date Day t+16 t+18 t+21 t+32 t+33
01/26/1993 Tue 7.4 10.0 9.8 11.6 12.1
01/28/1994 Fri 10.0 4.1 5.7 0.5 1.0
01/27/1995 Fri 1.8 1.3 0.5 2.6 3.6
01/26/1996 Fri 13.9 15.9 13.6 8.5 8.0
01/28/1997 Tue 1.1 1.4 1.1 12.4 14.3
01/28/1998 Wed 1.8 4.3 3.8 11.0 10.6
01/29/1999 Fri 11.2 12.1 8.4 5.9 2.2
01/31/2000 Mon 8.5 6.2 5.4 12.2 8.5
01/30/2001 Tue 6.8 8.3 10.0 12.0 12.5
01/24/2002 Thu 2.7 3.1 4.4 -0.4 -0.5
01/29/2003 Wed 0.2 0.5 -0.1 -0.1 -0.6
01/28/2004 Wed 11.7 11.3 10.6 12.4 10.1
01/26/2005 Wed 8.2 8.8 10.1 9.7 9.4
01/25/2006 Wed 1.3 1.2 0.3 -0.1 1.7
Avg 6.2 6.3 6.0 7.0 6.6
AvgPos 6.2 6.3 6.4 9.0 7.8
AvgNeg NaN NaN -0.1 -0.2 -0.6
PctPos 100.0 100.0 92.9 78.6 85.7
PctNeg 0.0 0.0 7.1 21.4 14.3
Maximum 13.9 15.9 13.6 12.4 14.3
Minimum 0.2 0.5 -0.1 -0.4 -0.6
StdDev 4.6 4.8 4.5 5.4 5.2
ZStat 1.3 1.3 1.3 1.3 1.3
Variance 21.3 23.4 20.3 28.8 27.1
14 Occurrences |
Comments:
Web Address of this trading idea:
Links:
2 http://www.markethistory.com/content/analog/analog.html?ticker=HSY
3 http://blog.lim.com/thelogicalsong/2007/01/buy_the_chocola.html
4 http://www.markethistory.com/content/earnings/edge.html?t=HSY&by_month=1
5 http://www.markethistory.com/staff/detail.html?s=mickey