Schaeffer's Daily Market Blog Features MicroStrategy, Comerica, Pharmaceutical Product Development, General Motors, and Reynolds American

Among the stocks featured in the July 14 edition of Schaeffer's Market Blog are MicroStrategy (NASDAQ:MSTR), Comerica (NYSE:CMA), Pharmaceutical Product Development (NASDAQ:PPDI), General Motors (NYSE:GM), and Reynolds American (NYSE:RAI). Schaeffer's Market Blog is just one of the many free market commentaries written everyday at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1M&PAGE=1

Schaeffer's Market Blog for Thursday, July 14, 2005:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1

11:12 AM MicroStrategy Soars

I've written about business software firm MicroStrategy (NASDAQ:MSTR) in this space before, most recently last month. On June 23, the stock rallied to 54.06 on positive comments from a brokerage firm. Today the stock is in the news again. The company announced that it has released MicroStrategy 8 software certified on Red Hat Enterprise Linux. Also, the same firm that made positive comments in June reiterated its "buy" rating today. All this (and the market's strength) has the stock up nearly six percent to 61.40. This is the stock's highest point since mid-March. I wrote in the Schaeffer's Gold Trading Floor Blog on July 7: "If the market is able to firm up and no skeletons are found in MSTR's closet, the stock may be worth trading on the long side. One key will be its 20-week moving average. Breaks of this trendline have been key in determining inflection points and trend reversals for the stock". It is up more than ten percent from that day's close.

11:39 AM Investors Add Puts on Comerica

According to Yahoo!Finance, Comerica (NYSE:CMA) and its subsidiaries operate as a financial services company in the United States, Canada, and Hong Kong. CMA operates in three segments: the Business Bank, Small Business and Personal Financial Services, and Wealth and Institutional Management.

Yesterday, put options traded briskly on CMA, as put volume was nearly 19 times heavier than average. A closer look into the activity reveals that it was concentrated in large put additions at the August 60 strike (CMA TL). Option players added nearly 9,900 contracts of CMA TL yesterday. A closer look into the activity shows that the majority was concentrated in two large block trades, a block of 4,912 and a block of 4,018. Both trades occurred at 11:26 a.m. Eastern time and went off closer to the ask, suggesting the contracts were purchased.

CMA stock has rallied recently and is trading very near the 60 level. It should be interesting to see if these put additions finish in the money by August expiration.

12:34 PM Pharmaceutical Product Development Higher on Positive Earnings

According to Yahoo!Finance, Pharmaceutical Product Development (NASDAQ:PPDI) and its subsidiaries provide drug discovery and development services, and products primarily in the United States and Europe. PPDI operates in two segments, Development and Discovery Sciences.

Last night after the market close, PPDI reported earnings of 41 cents per share, a penny ahead of Wall Street's estimates. Furthermore, the company also raised guidance for the rest of the year. PPDI now sees EPS in 2005 of $2.26-2.30 versus its prior estimates of $1.85-1.93.

The stock is trading sharply higher on the positive earnings news. In fact, at last check, PPDI was up more than 20-percent to $58.45.

1:48 PM General Motors Rises on a Brokerage Upgrade

General Motors (NYSE:GM) is up more than a dollar in mid-afternoon trading. The company received a brokerage upgrade this morning. Lehman Brothers raised its rating to "equalweight" from "underweight." Lehman told clients that with GM's strong liquidity, solid results at its GMAC finance unit, and support from investor Kirk Kerkorian, the "market is primed to buy into a multi-year automotive turnaround story." The brokerage firm said this may lead to GM's announcement of a new long-term profit objective by January. GM is trading at its highest point since late February and has rallied almost 50 percent from its April low of 24.67. Even so, pessimism is still high. Short interest is up more than 60 percent over the last five months. It now stands at a hefty 16 percent of the stock's float. Also, 14 of 17 analysts that have ratings on GM see it as a "hold" or worse. From a contrarian perspective, this is all good news.

4:36 PM Tobacco Giant Reynolds American Increases its Dividend

Tobacco giant Reynolds American (NYSE:RAI) ended the day 1.78 percent higher to close at 81.88. The catalyst was an 11-percent increase in the stock's dividend. The quarterly dividend will increase from 95 cents per share to 1.05 cents. This $4.20 annual dividend would result in a 5.1-percent dividend yield at the stock's current price. RAI held support at its long-term 10-month moving average near 78 on its recent pullback. Short interest is high at just over 11.2 million shares. This amounts to 7.7 percent of the stock's float and results in a short-interest ratio of more than 17 days. Both are three-year highs.

The above are just a few of today's Daily Market Blog entries. Click here to read all of today's Daily Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method.

SOURCE: Schaeffer's

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