FedEx (FDX), the freight logistics giant, jumped out to a new all-time high last week. It’s a stock I’ve traded successfully using options in my Trader’s Advantage service before to the tune of over 100% gains, so when it presented an opportunity again, I was intrigued.
Click to Enlarge When super-sized companies like FDX set new all-time highs for the first time in ages (July 2007 is the last time FDX hit a new all-time high), it may seem in some ways like a termination of its success — but in fact, we have seen repeatedly that it is usually just the beginning of a bright new chapter. Once they hit new highs, there are no losers in the stock, and thus, no natural sellers.
So far this week, the stock seems to be consolidating after a pullback from those highs, creating an ideal entry point for long positions.
Recommendation: Buy FDX at current levels for a $127 target.
Jon Markman operates the investment firm Markman Capital Insights. He also writes a daily trading newsletter, Trader’s Advantage, and CounterPoint Options, a service geared towards helping individual traders make steady, consistent profits with the VIX. . Check out his Top Stock for 2012 here.
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