Kicking Off 2007 in Style

Enter TIE February Calls

By Bryan Bottarelli
Wednesday, January 03, 2007 11:06 AM EST
Wed, 3 Jan 2007 16:06:00 GMT

Dear Bottarelli Research Member,

The pre-market futures are blasting to the upside, so your first trade of 2007 comes in the form of our old friend Titanium Metals (TIE – NYSE).

TIE

Yesterday, TIE announced that they sold their 43.7% stake in Valtimet SAS to ValTubes SAS for $75 million cash — which helped them record a record breaking pre-tax gain of $39 million for the fourth quarter. In the same breath, TIE announced that they also entered into a new long-term agreement with Valtimet to annually supply up to 2,500 metric tons of titanium strip — which gives them great visibility for the upcoming calendar year. Based on the news, TIE us up $0.74 in pre-market trading — and I’m guessing that the upward momentum of the markets will push the stock higher as the day progresses. So let’s get positioned in TIE calls right at the open of trading and ride the upside strength higher. Here’s the trade:

PLAY: Buy the TIE February 30 Calls (TIE BF) at the open of today’s trading. Last week’s closing prices were $2.00 to $2.05, but I expect those prices to be higher this morning since TIE is up $0.74 in pre-market trading. Consider these calls a buy anywhere under $3.00, but attempt to pick them up as cheap as you can. I’ll follow up with a protective stop loss price once we get an entry level on the calls.

Lock and load

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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