ACS provides a full range of information technology services including business process outsourcing, technology outsourcing, and professional services to the commercial sector and federal government. For the 6 months ended 12/31/00, revenues rose 6% to $979.5M. Net income rose 22% to $62.5M. Revenues benefitted from acquisitions and growth in technology outsourcing services. Earnings also reflect a gain on the sale of a minority interest.

January 28, 2001

After building a base for the past three months, Affiliated Computer Services just broke out of an inverse head and shoulders formation, notching a new 52-week high on strong volume. The company provides business process outsourcing, systems integration services and technology outsourcing services to commercial and government clients. The stock has had a great run over the last year, having risen from a 52-week low of $31 on March 8th to an all-time high of $63.13 on Friday. The company announced solid earnings on Thursday morning and we are now looking for a split announcement out of the next BoD meeting, expected on February 1st. The company already has enough shares for a split, with 500 million shares authorized and 50 million shares outstanding and the stock price is currently trading at historic split-levels. Going forward, support is the January 11th intra-day high of $62, with additional support at $60.40, the 5-dma. Resistance may come in at $63.50 or $65. Traders may consider entry pints on a bounce off of $62 or a move above $63.50 on volume greater than 700,000 shares by midday. We are setting our stop at $58 to guard against a reversal.

Picked on January 28th @ $62.94
Change since picked +0.00
Stop Loss @ $58.00

February 15, 2001

Affiliated Computer Services gapped down following news that it placed $250 million in Convertible Subordinated Notes on Wednesday after the bell. On Thursday, ACS traded to an intra-day low of $63.40, hitting our stops along the way. We were stopped out at $64 and we are dropping ACS from our Current Play list.

Picked on January 28th @ $62.94 Profit/Loss = +1.06 (+2%) (Stopped Wednesday @ $64.00)
Best Profit = +5.66 (+9%)

February 13, 2001

Affiliated Computer Services has been trading in a tight range over the past three sessions after hitting an all-time high last week. On Tuesday, shares of the information technology solutions provider rallied to an intra-day high of $66.62 before reversing directions and closing at $65.61 on volume of 157,000 shares. The momentum has turned marginally weaker, although the move is coming on light volume after an all-time high. Going forward, support is the 10-dma at $65.27 with stronger support at the February 5th intra-day high of $64.49. Resistance remains steady at the February 9th intra-day high of $66.90 and then the all-time high of $67.75. Traders may consider starting new plays on a bounce off of $65.27 or a move above $66.90 on volume greater than 175,000 shares by noon. We are leaving our stops at $64 to lock in profits.

Picked on January 28th @ $62.94
Change since picked +2.67
Stop Loss @ $64.00

February 11, 2001

Information technology and business process outsourcing solutions provider Affiliated Computer Services tested support at the 10-dma on Friday. Shares of ACS traded to an intra-day low of $65.09 before bouncing back to a close of $66.20 on volume of 306,000 shares. Despite two consecutive lower lows, ACS remains in an upward trend and the stock could be ready to take out its all-time high. As far as a split announcement, we are hoping to get a split with the next earnings release in April. The company has enough shares for a split, with 500 million shares authorized and 50 million shares outstanding, and the stock price is currently trading within historical split range. For now, support is the 5-dma at $65.76 with additional support at $65.05, the 10-dma. Resistance has moved up to Friday’s intra-day high of $66.90 and then the all-time high of $67.75. A bounce off of $65.76 or a move above $66.90 on midday volume of at least 200,000 shares may be potential entry points. We are keeping our stops at $64 to protect gains.

Picked on January 28th @ $62.94
Change since picked +3.26
Stop Loss @ $64.00