Granite Construction Inc. is a civil contractor whichconstructs dams, highways, airports, tunnels, bridges and other infrastructure-related projects in the west, southwestand southeast. For the FY ended 12/31/00, revenues increased 1% to $1.35B. Net income increased 5% to $55.8M. Revenues reflect growth in the market for residential and commercial site development. Net income also reflects an improved gross profit margin and increased interest income.

February 25, 2001

Granite Construction Incorporated is one of the largest heavy civil construction contractors in the United States and operates nationwide. The company operates in both the public and private sectors providing such services as construction of roads, highways, bridges, dams, as well as performing site preparation services for buildings, plants, subdivisions and other facilities. GVA announced a 3:2 split with their earnings report this past Wednesday the 21st. This will be GSA's third stock split since the company started trading publicly in 1997. The stock split will occur on April 13th. Good news seems to breed good news at GVA because the day after the split announcement, GVA was awarded a $21.9 million contract by the California Department of Transportation for the asphalt concrete resurfacing of Interstate-880 in Oakland, California. Switching our focus from the news to the chart, we note that on February 9th GVA hit a new 52-week high of $34.40. That new high was achieved on volume of 132,000 shares. GVA normally trades about 62,000 shares based on a 3-month average, so the new high was achieved on the kind of volume we like to see. We mention this because on Friday while the market was bleeding red with selling, GVA actually posted a gain of +1.74 for the day on 130,000 shares of positive volume. Looking to next week, if you are considering opening a new play on GVA, look for a move through resistance at $33.50 and then up at the present high of $34.40 on continued good volume. A bounce off a support level could also be considered for an entry point. Use the 10-dma at $32.17, the 20-dma at $31.50 or the 50-dma at $30.85 as support levels. We'd like to see volume of 45,000 or better traded by midday accompany the stock higher when considering a new play. For our protection we will post our stop loss at $30.50 just below the last level of support.

Picked on February 25th at $33.07
Change since picked 0.00
Stop Loss at $30.50

March 8, 2001

Thursday marked the forth day of limited price movement for shares of GVA. Since achieving a new 52-week high on Friday of last week, GVA has seen intra-day price movement of less than fifty cents. On Thursday 115,000 shares changed hands, this represents a 50% increase over the three-month average of 75,000. The current tug-of-war between buyers and sellers is evident by the three successive Dojis that have appeared on GVA's chart. A Doji is a charting symbol used in Japanese Candlestick Charting. Basically, when the pattern appears, it denotes indecision in direction. Going forward, a bullish pattern to watch for would be an engulfing pattern in which the previous day's bar is totally engulfed by an "open" candle. GVA is a little over a month away from its 3:2 stock split scheduled for April 13th. Prior to that date, we are watching for another split run to begin. Considering opening a new position if GVA bounced off support at $35.00, the 5-dma, or moves up and through resistance at $35.50 on strong volume of 60,000 shares traded by midday. We will maintain our stop loss at $33.50 on this play.

Picked on February 25th @ $33.07
Change since picked +1.93
Stop Loss at $33.50

March 6, 2001

This week Granite has hardly moved after finishing last week on such a strong note. On Monday the stock traded on better than twice its normal volume but only moved $0.75 for the day. Tuesday saw 83,000 shares change hands, slightly higher than the three-month average of 73,000. On a technical note, GVA may be in the early stages of forming a flag or pennant formation. If this is confirmed, we'll be watching for a breakout, as this split run play moves closer to its ex-date in April. For now, we will be watching for another break higher coupled with good volume. Those traders considering a new play on GVA might look for volume to exceed 60,000 by midday and the stock to climb through resistance on a volume surge. A bounce off support might also trigger a possible entry point. Since the follow through from last week's new high has been weak, we are going to tighten our stop on this play to $33.50 to lock in a profit should the stock turn south.

Picked on February 25th at $33.07
Change since picked +2.01
Stop Loss at $33.50

March 4, 2001

GVA, one of the largest heavy civil construction contractors in the United States, scored a new high of $35.48 this week on better than twice its normal trading volume. In our write up on Thursday, we closed our report on GVA by noting that we were raising the volume requirement to 60,000 traded by midday when considering opening a new play. Our parameters were easily met on Friday, as GVA traded on volume of 168,000 well above the three-month average of 66,000. GVA is one of our split-run plays and is due to split 3:2 on April 13th. We will now look for a series of new highs as the stock approaches its ex-date in April. For next week consider opening a new position in GVA if it bounces off support at $34.00 or advances further through resistance at $35.48 on heavy volume. Heavy volume will now be considered 60,000 traded by midday. Additional support exists back at the 20-dma at $32.45. Look for added assistance from the broader markets when considering starting a new play in GVA. We will continue to keep a stop loss at $30.50 for now until we get enough breathing room to ratchet it higher.

Picked on February 25th at $33.07
Change since picked +2.13
Stop Loss at $30.50