NATI leverages commercial technologies, such as industry-standard computers and the Internet, to bring affordable, productive measurement and automation tools to engineers and scientists around the world. For the FY ended 12/31/00, revenues rose 24% to $410.1M. Net income before account. change rose 20% to $55.2M. Revenues reflectnew and upgraded products, and increased market acceptance. Earnings also reflect increased interest income.

February 8, 2001

National Instruments (NATI) develops and manufactures hundreds of integrated software and hardware products, which are used to replace and communicate with older, more traditional instrumentation. Strong management and heavy investments in R&D have produced a string of 24 years of double-digit sales growth for the company. Currently, the company has 50.57 millions shares outstanding and 180 million authorized, enough to split the stock 2:1. Moreover, the recent strength in the stock has pushed NATI shares above each of its previous split-levels, which positions this play as a good split candidate. In addition, the stock has just broken above previous highs and continues to climb on strong volume. For the day, shares gained $2.19 on heavy buying of 502,000 shares. This is more than double the three-month average of 234,400 shares and is a good indication that momentum players might already be accumulating the stock. Look for initial resistance to arise at the $60 mark. Down below, look for support in the $52 to $5 range. Time possible entries off an advance through today’s intra-day high of $55.25 when accompanied by strong mid-day volume of 115,000 shares.

Picked on February 8th @ $55.06
Change since picked 0.00
Stop Loss @ $50.50

February 22, 2001

Aided by a Wednesday’s swift decline in the NASDAQ Composite Index, NATI shares sold off to hit our stop at $50.50. Although a rebound in technology stocks is sure to come eventually, it’s necessary to maintain firm stops as a cautionary step to further declines.

Picked on February 8th @ $55.06
Profit/Loss = -4.56 (-8%) (Stopped Wednesday @ $50.50)
Best Profit = +2.50 (+5%)

February 20, 2001

As a leading supplier of virtual instrumentation products and solutions in the United States, NATI has found new revenue streams by expanding operations abroad. Currently, 40% of the company’s revenue growth is expected to come from its international sales group. As for our play, NATI shares gave back some gains on Tuesday, which was initiated with a gap lower at the open. Despite the early drop, NATI only lost $1.00 to close at $52. At this level, the stock is now trading at a well-established base formed last month. The length of this established base is reason enough to believe that a rally could come from current levels. The theory here is that the more times a stock hits a certain level (in this case $52) the more strength that that level holds. So, should a reversal unfold from present levels, we’ll look for the initial test to come at the 20-dma of $52.33 (near today’s high). Secondary resistance should be much firmer at $54, bolstered convergence of the 5 and 10-dma’s of $53.99 and $53.69. Should NATI shares rally through either of these levels, we’ll look for potential entry points to arise. However, you may want to incorporate a trailing stop strategy, should the stock reverse sharply from resistance. As for support, look for a strong initial base to surface at today’s intraday low of $51. We’ll let reversals off this level present entry points, should good mid-day volume of 125,000 accompany the bounce. Keep firm stops at $50.50.

Picked on February 8th @ $55.06
Change since picked –3.06
Stop Loss @ $50.50

February 18, 2001

Once businesses realize the cost benefits of computer-based measurement and automation, few return back to their old ways. This trend is what has helped make NATI a leader in the automated commercial technologies market. It has also helped to generate earnings growth of 21% over the past 5 years. Furthermore, demand for automated Internet solutions should help the company to sustain this level of growth for several years to come. Closing out the week with a sharp bounce off the 20-dma of $52.15, shares of NATI may have just given us the first indication that they are ready to turn around. The intraday chart reveals that good buying followed the recovery off $52, which suggests that a surplus of buyers may hold the stock at this level. A positive reading on the MACD offers us further hope for a near-term advance. So, should a reversal unfold, we’ll look for initial resistance to now crop up at the 10-dma of $53.69. The 5-dma of $53.99 will also put forth resistance to this area; so don’t expect an easy breach through this zone. Upper opposition could next appear at the $55 mark and higher up at this week’s high of $57.56. Again, we’ll look for entry points to come when NATI shares move swiftly through these points on good daily volume of 250,000 shares or better. Support is now at the 20 and 30-dmas of $52.15 and $51.56 respectively. We’ll keep our stops firm at $50.50.

Picked on February 8th @ $55.06
Change since picked –2.06
Stop Loss @ $50.50