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Sterling Investment Services has recently initiated research coverage on Sun River Energy, Inc. We feel that this company has excellent long term potential and is worth taking a serious look at. Additional information on Sun River Energy, Inc. (OTC BB: SNRV) can be found (here)


The October 27th edition of the Sterling Weekly is now available. A copy of which can be viewed (here). Please feel free to sign up to receive this edition of the Sterling Weekly when it is available.

 

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Hottest Deals of the Week

PRIME STOCK NEWSLETTER FOR October 27th, 2008

(If you do not see today's edition, please hit the refresh button)

Position Statement: In our Prime Recommendation Letter we attempt to identify the recommendation with the highest probability of moving higher.  We recommend that stop orders be placed at the time of purchase,  and once the position has moved profitable we recommend a stop be placed a minimum of $0.375 above the purchase price and moved higher as the position moves higher.

Today's Comments: The overall market sharply lower on Friday in a very broad based move that saw every sector index I track move lower with the exception of the Insurance Index. The weakest sectors on the day were the Broker/Dealer, The Oil & Gas, Telecom, Airlines, Networking, Chemicals, Internet, Cyclicals, Banking, Transports, Retailers, Consumer, and Pharmaceuticals indices. Friday's close of the Dow Jones Industrial Average below the previous yearly low of 8,451.19 is a very negative trading signal. I am now expecting the Dow Jones Industrial Average to move lower and test 8,235.81 and then 7,762.34 on a closing basis. The Bottom Line: The overall market should move lower.


Sterling Calendar for October 27th, 2008
Economic & Earnings Calendar
Date Est. Time Release For

Briefing.com

Consensus Prior
10/27 10:00am New Home Sales Sep. 445K 450K 460K
10/28 10:00am Consumer Confidence Oct. 52.0 52.0 59.8
10/29 8:30am Durable Orders Sep. (1.0%) (1.0%) (4.5%)
10/29 10:35am Crude Inventories 10/25      
10/29 2:15pm FOMC Policy Statement        
10/30 8:30am Chain Deflator-Adv. Q3 4.2% 4.0% 1.1%
10/30 8:30am GDP-Adv. Q3 0.3% (0.5%) 2.8%
10/30 8:30am Initial Claims 10/25 470K 473K 478K
10/31 8:30am Employment Cost. Ind. Q3 0.7% 0.7% 0.7%
10/31 8:30am Personal Income Sep. 0.2% 0.1% 0.5%
10/31 8:30am Personal Spending Sep. (0.1%) (0.2%) 0.0%
10/31 9:45am Chicago PMI Oct. 50.0 48.0 56.7
10/31 10:00am Mich. Sent. - Rev. Oct. 55.0 57.5 57.5
Date: Comments:
10/27 FPL Group 'FPL' announces earnings before the market open. Est. $1.38
10/27 Hercules 'HPC' announces earnings after the close. Est. $0.39
10/27 Verizon 'VZ' announces earnings before the open. Est. $0.66
10/28 Apollo Group 'APOL' announces earnings after the close. Est. $0.67
10/28 Earthlink 'ELNK' announces earnings before the open. Est. $0.40
10/28 Fiserv 'FISV' announces earnings after the close. Est. $0.83
10/28 Kansas City Southern 'KSU' announces earnings before the open. Est. $0.60
10/28 Occidental Petroleum 'OXY' announces earnings before the open. Est. $2.71
10/28 US. Steel 'X' announces earnings. Time N/A. Est. $7.08
10/28 Valero Energy 'VLO' announces earnings. Time N/A. Est. $1.38
10/29 First Solar 'FSLR' announces earnings after the close. Est. $1.01
10/29 Hartford Financial Services 'HIG' announces earnings after the close. Est ($1.54)
10/29 :Legg Mason 'LM' announces earnings before the open. Est. $0.09
10/29 Newmont Mining Corp. 'NEM' announces earnings before the open. Est. $0.44
10/29 Office Depot 'ODP' announces earnings. Time N/A. Est. $0.08
10/29 Prudential Financial 'PRU' announces earnings after the close. Est. $1.05
10/29 Tesero Corp. 'TSO' announces earnings after the close. Est. $1.50
10/29 Visa 'V' announces earnings after the close. Est. $0.56
10/30 Aventine Renewable 'AVR' announces earnings after the close. Est. $0.13
10/30 ExxonMobil 'XOM' announces earnings. Time N/A. Est. $2.40
10/30 Flagstar Bank 'FBC' announces earnings after the close. Est. $0.13
10/31 NYSE Euronet 'NYX' announces earnings before the open. Est $0.73
  The full earnings calendar for this week can be found (here)

Recommendation: Sell/Short

Transocean, Inc. 'RIG'

Company: Transocean, Inc. Symbol: 'RIG' Closing Price: $66.26
Web: www.deepwater.com YH: $163.00 YL: $62.40 EPS: $15.62 P/E: 4.24

Shares Outstanding: 319 Million

Forecasted EPS:.$16.16 Market Cap.: $21 Billion
Dividend: N/A Yield: N/A Aver. Daily Trading Volume: 8.8 Million Shares  
Price Targets:  $65.05, $62.61, and then $53.39 Upside Stop:  $68.77/share
Options Rec.: May 2009 $65 Puts @ $14.50/contract Options Symbol: RKJ QM
Additional information on Transocean, Inc. "RIG'' can be found (here)

Company Description: Transocean, Inc., together with its subsidiaries, provides offshore contract drilling services for oil and gas wells. It offers deepwater and harsh environment drilling services; oil and gas drilling management services; and drilling engineering and project management services, as well as involves in oil and gas exploration and production activities in the United States offshore Louisiana and Texas, and in the U.K. sector of the North Sea. As of February 20, 2008, Transocean owned and operated 139 mobile offshore drilling units comprising 39 high-specification floaters, 29 midwater floaters, 10 high-specification jackups, 57 standard jackups, and 4 other rigs, as well as had 8 ultra-deepwater floaters contracted for or under construction. The company was founded in 1953 and is based in Houston, Texas.

Chart for Mosaic Company

Chart updates daily

Recent News: 10/24 Sector Snap: Shares of drillers slide with crude AP (Fri, Oct 24)
  10/15 Ahead of the Bell: Offshore driller backlogs AP (Wed, Oct 15)
10/16 Transocean Inc. Earnings Call scheduled for Wed, Nov 5 CCBN (Tue, Oct 14)
A full list of the news headlines for Transocean "RIG" can be found (here)
Our Analysis: The shares of Transocean, Inc. 'RIG' set a new multi-year closing low Friday on heavier than normal trading volume. This is a very bearish trading signal. The shares of 'RIG' have also been battered by the declining price of oil, which continues to move lower. The shares of 'RIG' should continue to move lower and test $65.05/share, a point of support set in mid August of 2006. If the shares of 'RIG' close below that level, then I would expect them to test $62.61/share on a closing basis. I think there is a very good chance the shares of 'RIG' will continue to move lower and test $53.39/share, a point of support established in late October of 2005. I see upside resistance on the shares of 'RIG' at $68.36/share, and have set our stops accordingly at $68.77/share..

Stocks Looking Higher

AMGN


Stocks Looking Lower
GE, C, CSCO, INTC, JPM, RIMM, AA, FCX, TWX, GM, HPQ, QCOM, MUU, HD, LVS, KO, MOS, LOW, SLB, VLO, JAVA, DD, SU, X, LUV, ADBE, NBR

Yesterday's Edition of the Prime Stock Newsletter
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