This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Book Profits on Boeing and LSI Corp

Stocks in this article: AVGO BA LSI SOX

NEW YORK (TheStreet) -- Whenever a company announces a stock-moving event it's time to consider a buy-and-trade opportunity. Today the consideration is to book profits on Boeing (BA) and LSI Corp (LSI) as these stocks are benefiting by a share buyback and a takeover, respectively.

On Dec. 6 I wrote, Cisco and Intel Are Buy-Rated Dow Stocks to Own, and in this post I provided my buy-and-trade profile for Boeing. In this story I indicated that it was time to book profits on the aerospace and defense giant as the stock had been downgraded to sell from hold, according to ValuEngine, following a price spike to an all-time intra-day high at $142 on Nov. 18.

Boeing shares opened higher to $138.10 this morning following the announcement of a $10 billion increase to its buyback program. In addition, the company announced a 50% increase in its quarterly dividend to 73 cents. Boeing still has a sell rating and is 34.4% overvalued and has gained 80.5% over the last 12 months.

The stock has been above its 200-day simple moving average all year and is now at $107.20, which is the risk on a reversion to the mean in 2014. The weekly chart profile shows a parabolic pattern with overbought momentum and its five-week modified moving average at $131.85. This bubble will eventually pop! My quarterly value level is $115.10 with monthly and weekly risky levels at $140.46 and $145.67.

On Dec. 11 I wrote, Buy Rated Semiconductors Lag the SOX and in this post I provided my buy-and-trade profiles for 15 buy-rated components of the PHLX Semiconductor Index (SOX) and among this group was LSI Corp. The stock closed Dec. 10 at $8.13 and was undervalued by 24.3% with a gain of 15.3% over the last 12 months.

LSI shares exploded to the upside by 39% on Monday after the wireless chip provider Avago Tech (AVGO) announced its intent to buy the provider of storage and networking solutions for $6.6 billion, valuing the stock at $11.15 per share. However, several shareholder rights groups announced, via Business Wire, they are investigating the Board of Directors of LSI for possible violations in connection with this deal.

The ValuEngine models do not take into account stock takeovers as the only overnight input was Monday's closing price at $10.96. As a result of this $3.05 price gap, LSI has been downgraded to hold from buy and is 69.1% overvalued when it was 24.3% undervalued on Dec. 11.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs