ABN AMRO NCP Roundup, page-2

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    + NCP
    ABN AMRO today has upgraded the Corp from a HOLD to an BUY. Why? Putting a large research document into one paragraph: NCP has turned more inward (not completely, but a lot more these days than it was say 12 months ago) and has focused on micromanaging the existing downturn on its core divisions. This is evidenced in the EBIT growth and cash-flow generated by NCP in the past six months. In short, we feel the worst is well and truelly over for NCP. Thus the upgrade. Implications on trading the stock for the next few days of trading? We have consistently stated that NCP below $10 is a BUY. Below $9.50, ship it in. Stock has seen significant domestic buying in recent days (notably by BBY) has seen some resilience although the Telepiu news update we broke three days ago (see Round Up) has caused some concern and is an example of the market taking a stick to the stock when it does NOT focus on core divisions. Stock got hit alittle last night on no new news although the NASDAQ falling –2.8% did not help (high correlation…). Our call to buy it below $10, preferably below $9.50 is an old one, but a good one. The stock always seems to get back to that $10 to $10.50 level. In short, its range bound. Buy it down here(ish) and knock it out around $10(ish).

    For the Bulls: NCPWZL (Nov, $9.50) DELTA 14
    (ATM, v. good delta)
    For the (High leverage) Bulls: NCPIZD (Jan, $13) DELTA 17
    For the Bears: NCPWZU (Nov, $9, PUT) DELTA -12
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