The Play Of The Day
January 4, 2000
08:33 AM EST.
Good Morning Stock Fans!
Today's Play of The Day is: Marketing Services Group, INC (NASDAQ:MSGI)
Marketing Services Group, Inc. (NASDAQ:MSGI) is a leader in the Internet and integrated marketing services industries. MSGi's revenues have grown from $16 million in fiscal 1996 to in excess of $100 million on an annualized basis. GE Capital is the owner of an 18 percent stockholder position in MSGi and CMGI is the owner of a 10 percent stockholder position in MSGi.
MSGi is organized into two business divisions: The Internet Group and The Direct Group. The Internet Group's mission is to acquire, invest in and incubate Internet companies. Its preliminary focus is on WiredEmpire, and its Marketing Agent technology. MSGi plans to expand into other strategic areas. The Internet Group provides Internet marketing, e-commerce applications, Web development and hosting, online ad sales and consulting. The Direct Group provides strategic planning, direct marketing, database marketing, telemarketing, telefundraising, media planning and buying. Through this business segment, MSGi will continue to grow by leveraging the synergies it has across all its companies in marketing, technology, and capabilities.
Looking at how the stock has traded of late, we see that it has behaved very much like a stock under accumulation awaiting an upcoming news release. The last two trading days of the 1999 saw shares of NASDAQ:MSGI) trade in an extremely tight range between $16.750-$17.18750 on average volume of more then 650,000 shares trading. (One of those days last Friday Decmeber 31, 1999 was a half day of trading)
Yesterday, January 3, 2000 Marketing Services Group, Inc. (NASDAQ:MSGI) is a press release announced that its Board of Directors has approved the merger of its WiredEmpire and Pegasus Internet subsidiaries. The combined subsidiaries will retain the WiredEmpire name and together, will provide clients a full offering of interactive solutions. The merger became effective January 1, 2000.
The news of the merger didn't do to much to cause shares of (NASDAQ:MSGI) to trade bigger volume. It still traded just over 700,000 shares and went as high as $19.3750 before it settled at $18.50. The stock still looks to me as if it is ready to move even higher. The biggest two reasons for this is the amount of action the January 2000 Option Calls have gotten of late out of the money. Over 400 plus option calls traded on MSGI in 2 different option call contracts. The January 20.00's and the January 22.50's. It looks very much like based on this option volume coupled with the fact that CMGI is very close to MSGI management tells me yesterday's 2 point move may just be the beginning of the move to the upside in this one.
Looking at today's futures it appears we will open down today on all markets including the NASDAQ. With MSGI more then 65% off its all time high reached last April 1999 (incidentally the company is better now, then it was then. It has more acquisitions) at 60.00. Taking all the above information into consideration it looks as MSGI is a low risk play with excellent possibilities of good gains.
KEY INDICATORS: (NASDAQ:MSGI)
Buy Area: $17.6250-$18.25
Sell Stop: $16.43750
Time Frame: 5 days, maybe sooner
Type of Trade: Swing Trade
"RUN THE OPTIONS!"
MSGI January 2000 $20.00 Call Options
MSGI January 2000 $22.50 Call Options
STOCKS TO WATCH TODAY:
(NASDAQ:DSLN) The stock looks ready to make a move as volume was higher yesterday. It should report big numbers as it did in for 3Q last year, earnings that came as a big surprise to First Call Analysts taking the stock in mid October to well over $20.00 a share. It may have similar moves in mind upcoming.
KEY INDICATORS: (NASDAQ:DSLN)
Buy Area: $15.43750-$15.93750
Sell Stop: $15.00
Time Frame: 5 days
Shares of (NASDAQ:AVNT) had huge volume yesterday as it moved up big. It may make a move today even higher, after if pull back and tests its trading range. We will keep a close eye on it today.
Our stock to watch yesterday, (NASDAQ:INPR) had LINUX news about 40 mins prior to the close. It went from 11.50 tall the way to over 19 in after hours trading last night. It is currently trading up 2 plus from yesterday close at $16.1250.
This one looks good to make 19 today after it pull back and tests yesterday's close at $13.93750.
STOCKS ON OUR SCREENS TODAY:
KLIC-Strong demand for wire bonders gives it 30% more upside, 6 months
TRUE- closed at day high
FOGD- uinque visitors near 1 mill this past quarter. Holiday user volume rose 750%
ASTN-closed at high yesterday. up in pre-market today
NWLL- It has only 1.3 mill shares outstanding it ran from $8.75 to $29.75 in after hours on news. Trading at $25.00 in pre market currently.
Have a great day!
More to come...