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Dykstra: Get Your Grip on Fastenal Calls

This stock delivered a win in March; it's time to go back.

Once again today, I'm returning to a stock I've had success with in the past.

In March, I picked



and scored a win in seven quick days.

As the name implies, Fastenal distributes fasteners to manufacturers and commercial contractors, with over 300,000 varieties of fasteners and nearly 400,000 general-purpose maintenance, repair and operations products. Fastenal also has the ability to custom-manufacture fasteners on short notice.

Because fasteners are heavy, other direct sellers face prohibitive shipping costs. But Fastenal has 12 North American distribution centers and its own in-house truck fleet that enables it to make five deliveries a week to 85% of its 2,000-plus company-owned stores.

Recently, Fastenal was given a five-star investment rating by Standard & Poor's along with

Best Buy


Abercrombie & Fitch




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On July 12, the company posted impressive second-quarter results, with sales and earnings up 13.3% and 17%, respectively. Although the company did a fine job of controlling expenses vs. last year, the company's gains on gross margin was even more notable. It also increased its dividend and has been buying back shares, which is a great use of shareholder capital.

Fastenal has averaged 20% returns on invested capital over the past five years and no debt. Its revenue tops $1.9 billion annually, and with the stock trading midway between the 50-day and 200-day simple moving averages, a deep in-the-money calls opportunity is knocking. Here is my play: I'm going to buy 10 February 35 (FQABG) calls for $9.30, or better. Please consider limit orders.

Game of Life

This past Sunday, an NFL game in Buffalo pitting the Bills vs. the Broncos was rendered meaningless when Kevin Everett, the Bills backup tight end, lay motionless on the field. Everett was injured as he made the tackle on the second-half kickoff. He was stabilized and transported to the hospital with a life-threatening spinal cord injury.

Emergency surgery, lasting four hours, was performed. However, on Monday, his doctors proclaimed that his chances of not having some degree of paralysis were extremely slim. Lo and behold, as he emerged from a drug induced coma on Tuesday, he was able to move his arms and legs, to the amazement of his treating physicians.

Declaring his dramatic turnaround virtually miraculous, some of his physicians are confident that he will walk again. Unequivocally, this 48-hour sojourn puts things in their proper perspective.

Today, at East Lake, in Atlanta, the fourth and final leg of the FedEx Cup Tour Playoffs begins, with Tiger Woods poised to put another trophy on his mantelpiece, and another $10 million in his retirement fund. Despite his trademark red shirt, which he adorns in every final round, expect Tiger to finish very much in the black on Sunday.

In the World Gymnastics Championships in Stuttgart, Germany, the United States Women's team dethroned the defending champs, China, thereby establishing themselves as the favorites for the gold medal in Beijing in 2008. Furthermore, 15-year-old Shawn Johnson, a 4'10" dynamo, won the all-around gold, becoming only the fourth American woman to ever do so.

Although she is just a sophomore in high school, Johnson "has nerves of steel," according to national team coordinator Martha Karolyi. On the men's side, the Americans silenced their critics, several of whom predicted they would not even qualify for the Olympics, by finishing fourth in the all-around team competition.

Dario Franchitti, this year's Indianapolis 500 winner, but perhaps better known for being Ashley Judd's husband, announced that he will leave the Indy Car Series for Nascar, where he will reportedly sign with Chip Ganassi Racing for the 2008 season.

In the realm of pure human speed, without the aid of a vehicle, Asafa Powell of Jamaica lowered his own world record in the 100-meter sprint to 9.74 seconds at the Rieti Grand Prix in Rieti, Italy. By lowering the standard 0.03 seconds, Powell rebounded from a disappointing third-place finish to America 's Tyson Gay at the World Championships last month.

The Players Club appreciates how breathtaking speed can be, regardless of whether it is on foot, in an automobile or on horseback. Moreover, we recognize that mesmerizing speed occurs in short bursts for relatively brief periods of time.

By guaranteeing recurring cash flow through our strategic partner, The Players Club acknowledges that financial health is not a 100-meter sprint, but rather a marathon, where the winner is able to sustain a certain high level of speed for a significant period of time.

Always remember: Life is a journey. Enjoy the ride!

At the time of publication, Dykstra had no positions in stocks mentioned.

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, and is featured regularly on CNBC and other cable news shows. Lenny was selected as OverTime Magazine's 2006-2007 "Entrepreneur of the Year."