NTRI

[Melf Elf]

Covered my short a few minutes back at $58.10 this was moving in tandem with the NASDAQ...and i already had a 3.7% gain...so I took it.

Vic,

Good job.  Applause.

For today, June 13, the bottom rail comes in at 57.201.  Just keep subtracting 0.31429 for each trading session.  NTRI could "walk down the rail" without breaking it.  You want to see that get broken, naturally, since you're short.

NTRI just printed 57.01, below the lower rail.  It's now at 57.20, dead on the bottom of the Bull Flag.  If stocks like NTRI don't rally off support...the market could get uglier than it's already been for the last month.

 

[vic666]

I shorted NTRI again on Thursday mid-day primarily bcoz the entire market rallied heavily but NTRI hovering most of the day in red!!

figured it was destined to go lower to fill the gap at $52 in the chart below.

but guess what then...had an opportunity to cover at $55, but was waiting for the gap gill at $52...towards the end of the day, it ended up finishing still in red, but at $57.34 (approx.) and the marktet had rallied big time that day.

so naturally, I was hesistant to hold this the next day (inspite of the fact that it closed red on a huge market rally day)...and covered my short at $57.56 AH (for a 1% loss approx.)

next day, it opened around $58 and nvever looked back...it was going down and down the whole day...with a low of around $53.33 !!!

if only I had held on, could have made atleast 3K....

biggest lesson from the trade was...the market had me guessing as to what it was gonna do next...was the thursday rally really sign of life back in the market (i thought so bcoz of the heavy volume and excellent price action on the NASDAQ)....and that led me to cover my short AH....but with the way the market is right now...you will get lots and lots of fake signals...I guess that's one of the primary indicators of a bear market...lots of "fake" positive signals to keep the "longs" holding on in hope...but the overall bearishness is always lurking around..fooling you into thinking otherwise.

As i mentioend sometime before...my first ever short trade was this past Tuesday (on NTRI)...for a cool profit...but I'm also being cautious as to what the market intends to really do...rally from the 12% plus pullback over the last 1 month or continue to slide into bearish territory....I simply have no clues...and that's what's buggin me - whether to take long or short positions in many stocks out there...u fortunately, quite a few stocks out there look like both good "long" and "short" set-ups...it;s just not clear what to do exactly bcoz of the market's many "fake" signals over the last few days/weeks.

hope some of you understand my frustration with the market!!  thoughts??

PS: note how the NASDAQ has met with resistance at the 20 MA over the last 1 month, each time it tried to jump back up. we are now once again very close to the 20 MA...so my first signs of life in the market is to see the NASDAQ jump back up over 2158 (the 20 MA) on above average volume. but the most recent candlestick seems like a bearish harami...so not sure if a rally is possible...dang! so many confusing signals...where the heck is the market headed??

[xtetic]

NTRI -
Late Monday, the company reported second-quarter net income of 53 cents per share on $132.6 million of revenue, topping analyst forecasts for earnings of 45 cents per share on $123.5 million in sales.

Shares fell, however, by $8.30, or 12.2 percent, to $59.50 in premarket trading on the INET electronic stock exchange as investors were unable to shake off the announcement that President and Chief Operating Officer George Jankovic is leaving the company.

Van Winkle raised his price target on the shares to $91 from $78, maintaining his "Buy" rating.

Full article at
http://biz.yahoo.com/ap/060725/nutrisystem_ahead_of_the_bell.html?.v=1
Also check
http://www.thestreet.com/_yahoo/newsanalysis/winners/10298986_2.html

Its down almost 20% now.

Can somebody explain me, who will be sellers at this point.  I noticed huge 10 cents spread in bid/ask throughout the day. 

And if any one follows the stock, p.s discuss.

I think its a great buy, and great time to get into a long position.  They even increased their year outlook, and industry is good too. 

[jorgegr]

Be carefull, you might be catching a falling knife.

jorgegr

[Tirebldr]

I agree! We are into a bear market now. MM's are taking it down. CEO is gone now. Perhaps before next earnings after it bases again. Just my never to be humble opinion.

[nullzero]

NTRI still looks like a good short possibly.

[xtetic]

And can you explain why do you think so?  I read there was too much short interest on July 21 st...but i thought after blowout earnings it would mean short covering....it acted otherwise, falling in news of COO leaving for family reasons ignoring the blowout earnings and increased estimates for entire year.

What would be a trading strategy for me here......I am in [email protected], should I sell and just get out....?  Its trading at 54.00.

[nullzero]

My advice would be to get out and dont look back. NTRI is a falling knife... dead cat bounce might not happen anytime soon espically with a bunch of nervous longs heading for the doors. Short interest is picking up steam too for every short covering there probley is 1-2 shorts taking the place. Insider selling isnt helping NTRI much at all either. I believe NTRI is topped off at 60 and is on the decline the P/E is on the high side as well. I always try to exit a stock with a max loss of -10%. Whatever you decide be firm about it and dont change plan.

[joet]

decisions decisions...  I was short NTRI before earnings but covered 2 days before with a 3% loss... wish that i had held...

this reaction seems heavily over done to me and i expect to see a bounce in the near term...  i was going to compare with the JCI chart from the past week, big fall and bounce... but looking at the companys fundemental numbers JCI seems to be a much more solid company so perhaps that bounce was more justified.  I will be watching NTRI in the AM but will probably only paper trade a day position based on my feeling of the action just after open.  GLTA
Cheers Joe

[la-onda]

update:
1)
NutriSystem 2Q Profit Surges
Monday July 24, 5:32 pm ET
NutriSystem 2nd-Quarter Profit Soars; President Resigns, Sending Shares Down

HORSHAM, Pa. (AP) -- NutriSystem Inc., an operator of weight-loss programs and fitness centers, said Monday its second-quarter profit more than quadrupled as revenue soared.

In addition, NutriSystem issued guidance for the third quarter and full year well above Wall Street predictions.

But the company also announced the resignation of its president and chief operating officer, sending its shares down $5.80, or 8.9 percent, to $62 in aftermarket trading on the INET electronic exchange.

The drop reversed gains made during the regular trading session on the Nasdaq, where NutriSystem shares closed up $2.85, or 4.4 percent, at $67.80.

NutriSystem earned $19.8 million, or 53 cents per share, compared with $4.3 million, or 12 cents per share, for the same quarter in 2005. The 2006 profit included 3 cents per share in stock-option expenses.

Revenue grew to $132.6 million from $40.9 million in the year-ago period.

The quarter's results came in well ahead of Wall Street expectations. Analysts polled by Thomson Financial had expected a profit of 46 cents per share, including 3 cents per share in stock-option expenses, on $123.5 million in revenue.

Company officials credited an increase in marketing directed at men, which accounted for about 21 percent of new customers during the quarter, coupled with a jump in direct channel revenue and customers for the increases.

Direct channel revenue totaled $122.5 million during the quarter, up 242 percent from the same period in 2005. NutriSystem added about 168,000 new direct channel customers during the quarter, up 190 percent from about 58,000 new customers in the year-ago period.

NutriSystem said it expects third-quarter earnings of 47 cents to 50 cents per share, including 2 cents per share in stock-option expenses, on revenue of between $135 million and $140 million.
Analysts, on average, expect third-quarter earnings of 44 cents per share, including stock-option expenses, on $120.2 million in revenue.

For the full year 2006, NutriSystem expects a profit of between $2.04 and $2.10 per share, including 10 cents per share in stock-option expenses, on revenue of $525 million to $535 million.
Analysts expect 2006 earnings of $1.87 per share, including stock-option expenses, on $502.9 million in revenue.
NutriSystem said that George Jankovic, the company's president and chief operating officer since December 2002, is resigning in order to assist family members overseas with serious health problems.
Jankovic, who will remain an adviser to the company, is also resigning as a company director. Michael J. Hagan, the company's chairman and chief executive, will also assume the title of president.
The company also said Thomas Connerty, an executive vice president and the company's chief marketing officer, will be promoted to executive vice president of program development, effective Tuesday.


2)

NutriSystem slumps on president's departure
By Carolyn Pritchard, MarketWatch
Last Update: 6:21 PM ET Jul 24, 2006

SAN FRANCISCO (MarketWatch) -- NutriSystem Inc. shares fell more than 14% in Monday's late trading session after the weight management services provider reported quarterly profit that more than quadrupled and lifted its full-year forecast, but said its president and chief operating officer has resigned due to family health issues.
The company said second-quarter revenue rose as net income increased to $19.79 million, or 53 cents a share, from $4.32 million, or 12 cents a share, during the same period in the prior year. Revenue rose to $132.6 million from $40.9 million in the prior year.
Excluding stock options expenses, earnings came in at 56 cents a share.
Analysts polled by Thomson First Call had expected a per-share result of 46 cents on revenue of $123 million.
For the third quarter, NutriSystem forecast per-share earnings of 47 cents to 50 cents, and revenue of $135 million to $140 million. Analysts are looking for a quarterly per-share result of 44 cents and revenue of $120.2 million.
The company said George Jankovic has resigned as president and chief operating officer, citing personal reasons.
"My wife and I have had very serious family issues and they've gotten substantially worse recently," he said on a conference call.
"My conscience is clear," he said of his decision to step down, calling NutriSystem a "well-oiled machine."
Chairman and Chief Executive Michael Hagan will assume the additional title of president. End of Story


3)
NutriSystem "buy," estimates raised

Wednesday, July 26, 2006 3:29:29 AM ET
Lazard Capital

NEW YORK, July 26 (newratings.com) - In a research note published yesterday, analyst Colin Sebastian of Lazard Capital reiterates his "buy" rating on NutriSystem Inc (NSI.ASE), while raising his estimates for the company. The target price is set to $75.

http://www.newratings.com/analyst_news/article_1328299.html

[AussieTrader]

MArket likes an excuse to sell off right now. NTRI had a great earns report, but the COO leaving was the excuse and catalyst to sell it hard (probably retail selling to the pro's? Who knows exactly). 200 day now key support zone, if that fails it won't be nice. Fundamentally NTRI 'should' come back, current market and sentiment however currently disagrees.

Watching for bottom to be put in around the 200 day.

Good Trading

[Melf Elf]

200 day now key support zone, if that fails it won't be nice. Fundamentally NTRI 'should' come back, current market and sentiment however currently disagrees.

Watching for bottom to be put in around the 200 day.

Good Trading

Aussie,

Good observation.  Applause. 

Yes, NTRI really needs to bottom in that area because it's TRIPLE support.  Before we get to that, a quick review of a few technical features,  which we've all discussed in other folders:

1. Starting with the Right Shoulder of the H&S Top at 44.80 on February 27:

When the high of a Right Shoulder gets taken out to the upside, you don't want to stay short (discussed in the ESLR and GIGM folders).

In the case of ESLR, the takeout was a Bull Trap fakeout, but there were other opportunites to re-short it.

In the case of GIGM, it was the beginning of a huge 100%+ rally.

When the high of the Head gets taken out to the upside (like GIGM and NTRI), you really, really don't want to stay short.  You want to get long (also discussed in the GIGM folder).

In the case of NTRI, look what happened after the high of the Head (50.00) got taken out. 

Horrible short squeeze.  That giant April 25 gap probably was the last earnings release, but it also was fueled by players caught short, having to buy to cover.

2. The June 16 break of the channel (in blue).

Shorting that break is fine.  "Sell, or sell short, breaks of support." But, have a reasonable stop.

That break ended up being a gap-filling Bear Trap (the 52.75 gap before April earnings was filled), then NTRI went back up through the channel (in blue), "trapping" bears below the channel. 

3. "When a stock has a terrible gap down at the open, I sell AT THE MARKET, without hesitation."  That doesn't always mean that the stock won't have a snapback rally, but in the vast majority of cases, the stock is going lower.  We've had many, many examples of stocks like NTRI that we've discussed in other folders over the past year.

Notice that when NTRI gapped down on Tuesday, the top of the channel (in blue) was at 59.90.  NTRI open at 59.73, rallied a bit, then tanked.  UGH..it looks like someone grabbed that pre-earnings white candle by the throat, and slammed it back inside the channel.

Just from that 59.73 gap down alone, NTRI is down an additional 18.47% at yesterday's 48.70 close.

 

Many 3SOF members won't hold through earnings, which sure isn't a bad strategy.  But, again, and this is only a suggestion, if you're caught holding on a slam to the downside, particularly below support, get out.  And, certainly don't "buy more" because it's cheap...or because "the stock shouldn't have done that."

NTRI, prior to earnings, had found support at the top of the channel, and was in rally mode.  That top of the channel support got taken out at the gap down opening.   

There are plenty of other stocks to buy.  Don't buy one that is tanking on "try to catch a piano being thrown off the top of a buliding" volume.  NTRI's volume on Tuesday was the highest in at least two years, if not longer.

TRIPLE SUPPORT:

NTRI, as Aussie said, is coming into 200 DMA support, as well as channel support (blue) and neckline/trendline support:

1. 47.55 - 200 DMA

2. 46.84 - Bottom of the channel (blue).  It falls 0.314 points per day.

3. 46.43 - Neckline/Trendline (red).  It rises 0.094 per day.

Volume on this slam to the downside has been huge, so I'm only going to play it for a quick bounce with a 2-3% stop loss if NTRI falls into the 46s, and only because it "should be" TRIPLE support.

Good luck, if anyone plays it.

 

[sebfr]

Hi,

A great opportunity...All comments are in the chart

Entry price : 59.88
stop-loss : 65
First Target at 50

[vic666]

the chart tells me NTRI is back in play...it tested the 50 day SMA on Thursday and Friday of lat week, and again today...and bounced back up.

As the saying goes for chartists, after a long uptrend, wait for a pullback and successful test of the 50 day MA for an entry point.

I got in today at $62.41 and expect a test of the recent highs in a couple of weeks max. Being a position trader, I'm gonna use today's low of $61 as my STOP.

[la-onda]

hi, setravis please merge all NTRI threads 
any other opinions ??

cheers
O.

Analyst update:
1)
NutriSystem "market perform," target price reduced
Thursday, February 01, 2007 0:51:56 AM ET
Ryan, Beck & Co
NEW YORK, February 1 (newratings.com) - Analysts at Ryan Beck & Co maintain their "market perform" rating on NutriSystem Inc (NSI.ASE), while revising their estimates for the company. The target price has been reduced from $75 to $63.
In a research note published yesterday, the analysts mention that the company has revised its EPS and revenue guidance for 4Q06 marginally higher than the estimates mainly to reflect rising reactivation revenues and higher revenue per men's customer. The EPS estimate for 2006 has been raised from $2.23 to $2.26. The EPS estimate for 2007 has been reduced from $3.00 to $2.81 to reflect higher customer acquisition costs.

2)
NutriSystem "buy," target price reduced
Thursday, February 01, 2007 3:42:45 AM ET
Kaufman Brothers
NEW YORK, February 1 (newratings.com) - In a research note published yesterday, analysts at Kaufman Bros reiterate their "buy" rating on NutriSystem Inc (NSI.ASE). The target price has been reduced from $102 to $85.

3)
NutriSystem "market perform," target price reduced
Thursday, February 01, 2007 3:45:08 AM ET
Ryan, Beck & Co
NEW YORK, February 1 (newratings.com) - In a research note published yesterday, analysts at Ryan Beck & Co reiterate their "market perform" rating on NutriSystem Inc (NSI.ASE). The target price has been reduced from $75 to $63

4)
NutriSystem "buy," target price reduced
Thursday, February 01, 2007 3:47:09 AM ET
Lazard Capital Markets
NEW YORK, February 1 (newratings.com) - In a research note published yesterday, analysts at Lazard Capital reiterate their "buy" rating on NutriSystem Inc (NSI.ASE). The target price has been reduced from $84 to $72

5)
NutriSystem "market outperform," target price reduced
Thursday, February 01, 2007 3:49:04 AM ET
Boenning & Scattergood
NEW YORK, February 1 (newratings.com) - In a research note published yesterday, analysts at Boenning & Scattergood reiterate their "market outperform" rating on NutriSystem Inc (NSI.ASE). The target price has been reduced from $92 to $75.