Atlantic Coast operates as United Express in the Eastern and Midwestern United States, and as Delta Connection in the Eastern U.S. The company has a fleet of 109 aircraft and offers approximately 650 daily departures, serving 51 destinations in 24 states. Atlantic Coast employs over 3,200 aviation professionals.

February 5, 2001

Ladies and Gentlemen, ACAI continues its ascent for the following reasons: First, soaring energy prices, one of the biggest expenses for airlines, have pulled back and appear to be stabilizing. Secondly, the company announced a 2:1 split on January 25th. The split will be made payable on February 23rd. The stock did not immediately lift off following the split announcement, however, because Salomon Smith Barney downgraded the stock to “outperform” from “buy” right after the announcement. With any luck, the good analysts at SSB are kicking themselves now. Today, ACAI soared to a new high after breaking out of a flag pattern. Today's volume of just over 589,900 was more than three times the three-month average daily volume of 190,000. Despite the recent gains, look for momentum traders to drive the stock higher for the next couple of days. The MACD is positive and rising and the Money Flow is making new highs. Perhaps the key indicator that supports the possibility for a continued advance is the RSI, which has room to run before indicating an overbought condition. As long as the stock does not gap up more than three points on the open, aggressive traders can probably jump on board.

Picked on February 5th @ $46.38
Change since picked +0.00
Stop Loss @ $42.50

February 22, 2001

The broad market declines we have seen this week have created enough turbulence to deny a meaningful split run for the shares of ACAI. The 2:1 split is payable tomorrow and we are unfortunately running out of time. The stock will begin trading at the split adjusted price on Monday. We will therefore exit this play no later than tomorrow's closing print. The past two days have not seen any progress for the share price of this fast growing regional airline. Nevertheless, it is encouraging that today's early action saw the stock climb back into last week's consolidation range. A short covering bounce back rally in the NASDAQ (COMPX) tomorrow could result in a final push that may get us back into the black with this play. Day traders may want to try a quick play if ACAI can move above the resistance offered by today's high of $47.00 in the early going tomorrow. This trade would be even more promising if the stock sees first hour trading volume over 75,000 shares.

Picked on February 5th @ $46.38
Change since picked -1.25
Stop Loss @ $42.50

February 20, 2001

Today's overall market collapse into the close put ACAI's share price into a holding pattern. It is, nevertheless, quite encouraging that ACAI managed to only lose a sixteenth and was able to slam the brakes on the declines we saw at the end of last week after the stock broke below a nicely established base. A move above $45.38 would put ACAI back into last week's trading range and would suggest a test of last week's resistance of $47.25. The NASDAQ (COMPX) has reached a short-term oversold level. Any bounce tomorrow and Thursday should help ACAI to rally into Friday's 2:1 split payable date. We will exit this position no later than Thursday's close.

Picked on February 5th @ $46.38
Change since picked -1.25
Stop Loss @ $42.50

February 18, 2001

ACAI, a regional air carrier that operates under the more familiar names of Delta Connection and United Express, has seen its stock soar due to a sizable increase in their business. January saw an increase of 40.6% in revenue passenger miles (RPMs) over January 2000. The total number of passengers carried increased 27.7%. The ascending share price has resulted in ACAI’s management declaring a 2:1 split. This occurred on January 25th and the split is payable this Friday. This leads us to believe that there is a good chance for a split run this coming week. We will exit this position no later than Thursday's close in order to avoid the possible profit taking that may accompany the split. A pending strike announcement from Delta Airlines (NYSE:DAL) pilots on February 28th may hold the stock back. We will keep an eye on the wires because if a settlement between Delta and its pilots is reached prior to next Monday's deadline, we may see a nice rally in the share price of not only Delta but also ACAI. The share price of ACAI had built a nice base just above $45.00. Unfortunately, Friday's market collapse saw the stock dip below this base. It is slightly encouraging that ACAI did manage to close above $45.00. New positions should probably be avoided if Tuesday's action sees the stock drop below Friday's low of $44.63. If it looks like the stock is going to close tomorrow above $45.50, positions may be added in anticipation of the possible split run. The MACD issued a sell signal on Friday, which does concern us. On the plus side, Money Flow and OBV remain quite strong. Hopefully, this indicates that there was very little conviction behind Friday's drop.

Picked on February 5th @ $46.38
Change since picked -1.19
Stop Loss @ $42.50