Momenta Pharmaceuticals, Inc. (MNTA)

[floblu14]

Momenta Pharmaceuticals (MNTA) Showing Bullish Technicals But Could Break Through $20.27 Resistance
Posted: Tuesday, May 10, 2011 8:32 AM EDT

Momenta Pharmaceuticals (NASDAQ:MNTA) closed Monday's bullish trading session at $19.18. In the past year, the stock has hit a 52-week low of $11.11 and 52-week high of $26.20. Momenta Pharmaceuticals stock has been showing support around $17.01 and resistance in the $20.27 range. Technical indicators for the stock are Bullish. For a hedged play on this stock, look at the Sep '11 $17.00 covered call for a net debit in the $15.78 area. That is also the break-even stock price for this trade. This covered call has a duration of 130 days, provides 17.73% downside protection and an assigned return rate of 7.73% for an annualized return rate of 21.71% (for comparison purposes only). A lower-cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the MNTA Jan '12 $12.50 call and selling the Sep '11 $17.00 call for a total debit of $4.00. The trade has a lifespan of 130 days and would provide 13.97% downside protection and an assigned return rate of 12.50% for an annualized return rate of 35% (for comparison purposes only). Momenta Pharmaceuticals does not pay dividends at this time. [FBB-Seven Summits Research]

http://www.marketintelligencecenter.com/analyfav/1271877