SAM

[Ramsburg]

Profile:
The Boston Beer Company, Inc. engages in brewing and selling malt beverages and hard cider products primarily in the United States. It offers beers under the Samuel Adams name, flavored malt beverage products under the Twisted Tea name, and cider product under the HardCore Cider name with a focus on Samuel Adams Boston Lager, Sam Adams Light, and Samuel Adams Seasonal Beers. The company sells its products to a network of wholesale distributors, who then sell to retailers, such as pubs, restaurants, grocery chains, package stores, stadiums, and other retail outlets. It sells its products in the United States, Canada, Europe, the Caribbean, and the Pacific Rim. The Boston Beer Company was founded by C. James Koch in 1984 and is based in Boston, Massachusetts.
Website: http://www.bostonbeer.com

Trading Idea:

Technicals: SAM has a long term bullish chart, and it's just breaking its highs...
Yesterday, SAM had a breakout of a difficult trading range closing a few ticks above 2004 high of $27.95. The $27.50 resistance was pulling the price down for the last few months, and yesterday was the first close above that reference over increasing and above average volume.
This gives us a good risk / reward ratio to setup a trade, SAM is not much volatile, and the supports are relatively near the current price.
When projecting the short term triangulation, we get $29.50 as a primary target, but looking to the big picture (long term chart) the upside potential is interesting...

Fundamentals: SAM looks like a very solid company; it missed the 2006-Q1 earnings estimates but even so the stock price holded pretty well. Revenues are increasing, and part of the reason on a weaker Q1 was an increase on marketing spending, which can bring results now.  

Trading Plan:
We'll buy SAM today at or near the open, and we'll set a stop at $26

[Ramsburg]

SAM is holding above the breakout zone even with the recent drop on the markets, volume has been low, but within the average (this is a low volume stock).

Trading Plan:
Hold SAM with a stop @ $26

[Ramsburg]

Update:
SAM is on the right track, after a quick consolidation following the breakout of $28, SAM had a good punch to the upside, almost touching the primary target of $29.50 (the triangle breakout target).

This is a low volume stock, but volume has been above average for most of this breakout period, showing some new money coming in this stock. For now we'll just update the stop level, and wait a bit more for further price action.

Trading Plan:
Hold SAM with a stop @ $26.90

Regards,

[Ramsburg]

Update:
SAM had a little retrace from the $29.50 resistance, nothing to worry about for now; we'll maintain the same trading plan.

Trading Plan:
Hold SAM with a stop @ $26.90

Regards,

[Ramsburg]

Update:
SAM is holding these levels, doing another consolidation range. We'll maintain the trading plan for now.

Trading Plan:
Hold SAM with a stop @ $26.90

Regards,

[Ramsburg]

Update:
SAM just tested a new high today, but was forced to close within the recent price range of consolidation. We expect a new breakout soon.

Trading Plan:
Hold SAM with a stop @ $26.90

Regards,

[Ramsburg]

Update:
Nice day for SAM, our low volume mover
SAM just had a new breakout and almost touched the $30 mark... This price can act as a psychological resistance (or maybe not), but SAM is behaving as expected even with an erratic broad market, running slowly higher, holding high levels, and going higher again.
Yesterday's candlestick suggests continuation; we'll just keep the same trading plan for now.

Trading Plan:
Hold SAM with a stop @ $26.90

Regards,

[Ramsburg]

Update:
Considerable correction for SAM, but taking in consideration the overall market sell off, SAM hold well its main bullish pattern and stayed above the breakout level. We are just going to upgrade our stop one more time.

Trading Plan:
Hold SAM with a stop @ $27.40

Regards,

[Ramsburg]

Update:
SAM is already working its way out of the recent correction; volume is increasing (but still a low volume stock), the price action today suggests a continuation for the short term.
There is a nice catalyst on play now; taking in consideration that SAM missed the last earnings estimates also because extra marketing investments (there is a reason to expect better earnings now):
Boston Beer Company Earnings Call scheduled for Tue, Aug 8

We are not thinking to hold SAM through the earnings, but until Aug 8 we should have enough time for the projected price development. We are keeping the same plan for now... SAM may be ready for a run...

Trading Plan:
Hold SAM with a stop @ $27.40

Regards,

[Ramsburg]

Update:
SAM is acting bullish for the last few days, probably anticipating earnings, so we expect SAM to hit new highs before August 8.

Trading Plan:
Hold SAM with a stop @ $27.40

Regards,

[Ramsburg]

Update:
SAM is having some trouble to surpass the 29.50 area, some strange consolidation is going on, but we expect a breakout before next Tuesday. We'll just upgrade our stop at this time:

Trading Plan:
Hold SAM with a stop @ $28.25

Regards,

[Ramsburg]

Unfortunately our stop was triggered during yesterday session (it was probably too tight at this point and taking into consideration the earnings release).
-   Our position was closed at $28.25 for a minor profit.

Personally I would hold this position, as I believe that a breakout of $30 will happen soon.

Regards,