Publish date:

Dykstra: McGraw-Hill Options Look Good

It's just too dominant to ignore. Also, this week's Stat Book.

One day after we celebrated Labor Day, Wall Street investors held a celebration of its own, as stock prices in the technology sector, along with energy-related stocks, rebounded considerably from their August lows.

It was also a good day for our picks.

Yahoo!

(YHOO)

, one of our open deep-

in-the-money

calls, jumped 5.5% after Bear Stearns announced it as a top pick.

In addition, we had wins with

Morgan Stanley

(MS) - Get Report

and

Helix Energy

(HLX) - Get Report

to add to Stat Book, rounding out the week with a nice $9,820 in profits. (The Stat Book is printed at the end of this column.)

McGraw-Hill Companies

(MHP)

TheStreet Recommends

is not only a leader in all the markets it serves, it's more dominant than ever.

The stock is also a good value after getting unduly punished after its most recent earnings report, so it's where we're turning our attention.

This company does much more than publish textbooks. Operating under the well-known Standard & Poor's brand, it provides information services and is the world's leading provider of independent research, indices and ratings. (I am a huge fan of the S&P Report.)

Its worldwide educational publishing arm touches nearly every aspect of the educational market with a huge array of products for education covering preschool to the higher education market, as well as professional, reference and trade publishing.

Its information and media segment includes

BusinessWeek

, a business magazine, and J.D. Power & Associates, a global marketing information company that conducts surveys of customer satisfaction, product quality and buyer behavior.

Its broadcasting group operates nine TV stations, including four ABC affiliates and five Azteca America affiliates.

McGraw-Hill reported strong second-quarter results last month, but its stock was still punished -- it has dropped nearly 20 points from its 52-week high back in July and was most recently trading Wednesday at $50.91.

This is

definitely

a stock that fits into my DITM calls strategy.

I will take advantage of this undervalued stock by placing a limit order to buy 10 contracts of the February $40.00 DITM calls (MHPBH) for $11.60 or better.

And now, let's get to the Stat Book.

At the time of publication, Dykstra was long Yahoo!.

Nicknamed 'Nails' for his tough style of play, Lenny is a former Major League Baseball player for the 1986 World Champions, New York Mets and the 1993 National League Champions, Philadelphia Phillies. A three time All-Star as a ballplayer, Lenny now serves as president for several privately held businesses in Southern California. He is the founder of The Players Club; it has been his desire to give back to the sport that gave him early successes in life by teaching athletes how to invest and protect their incomes. He currently manages his own portfolio and writes an investment strategy column for TheStreet.com, and is featured regularly on CNBC and other cable news shows. Lenny was selected as OverTime Magazine's 2006-2007 "Entrepreneur of the Year."