Fastenal Company (NASDAQ: FAST) closed Wednesday’s trading session at $58.95. In the past year, the stock has hit a 52-week low of $40.97 and 52-week high of $61.53. Fastenal stock has been showing support around $58.23 and resistance in the $60.13 range. Technical indicators for the stock are Bullish and S&P gives FAST a very positive 5 STARS (out of 5) strong buy rating. For a hedged play on this stock, look at the Aug ’11 $55.00 covered call for a net debit in the $52.55 area. That is also the break-even stock price for this trade. This covered call has a duration of 198 days, provides 10.86% downside protection and an assigned return rate of 4.66% for an annualized return rate of 8.59% (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 FAST Jan ’12 $34.58 call and selling the Aug ’11 $55.00 call for a total debit of $18.80. The trade has a lifespan of 198 days and would provide 9.45% downside protection and an assigned return rate of 8.62% for an annualized return rate of 16% (for comparison purposes only). Fastenal has a current annual dividend …
Read the full Article via Fastenal (FAST) Showing Bullish Technicals With Support At $58.23.