MO - Phillip Morris Cos. $36.00 +0.38 (+3.56) Philip Morris is a consumer products conglomerate best known for its tobacco, Kraft Foods and Miller Brewing units. Shares of MO have been trending higher since January after correcting nearly 69% from its all-time high of $59.50 on 11/25/98. More recently, MO has attracted a horde of value investors due to its low price-to-book (P/B) and price-to-earnings (P/E) multiples, as well as its 5.95% annual dividend yield. The stock is also getting a buzz from the rumor that George W. Bush may ease up on the litigation against the tobacco industry if elected President. On Thursday, MO hit a 52-week high of $36.50, which has us believing that ongoing weakness in the technology sector, coupled with a revival of the consumer cyclical stocks, should continue to fuel an MO rally. Although not a legitimate split candidate, we like the stock nonetheless because of the recent momentum it has acquired over the past month. From a technical perspective, initial support is at the 5-dma of $34.94, with stronger support at the 10-dma of $33.44. Further up, there is resistance at $37 and then $39. We are looking for entry points on a bounce off of $35 or a breakout above $37 on volume of at least 3.8 million shares by midday. We plan to set stops at $33 to limit losses.

Picked on Oct 26th @ $36.00 Change since picked +0.00

AHP - American Home Products Corp. $63.50 -0.88 (+3.69)

American Home Products is probably best known as a purveyor of popular consumer products Robitussin, Dimetapp and Centrum Vitamins. However, the company also has a substantial presence in consumer health care and agricultural products. We are adding AHP to our play list after the company posted another profitable quarter on October 19. AHP matched analyst's estimates and posted an 18% increase in quarterly profits. Since then, its stock has been rising steadily to Thursday's new high of $65.25. Today's advance came on impressive volume of 5.5 million shares, well above the 3-month average of 3.1 million. We now see this stock as a split candidate. To that end, the company has enough authorized shares to announce a 2-for-1 split. Should the market cooperate, we feel that AHP could experience further gains. As of Thursday's close, the stock now has support at the 5-dma of $62.25 and the 20-dma of $59.25. Resistance will be Thursday's intra-day high of $65.25. If you are considering opening a new play on AHP, possible entry points should include a bounce off support if followed by good volume (4 million shares or better). A bold charge up through resistance on good volume might also work. Look for confirmation of strength in the Dow Jones Industrial Average (INDU) and the AMEX Pharmaceutical Index (DGX) when opening new positions. We will place our stop loss at the lowest level of support at $59.25. Please review our IN PLAY section for updates and changes to our trailing stops.

Picked on October 26th @ $63.50 Change since picked 0.00