BKH is an energy & communications company consisting of three business units: regulated energy, independent energy and communications. For the 3 months ended 3/31/01, revenues totalled $566.4M, up from $248M. Net Income applicable to Common totalled $32M, up from $9M. Results reflect increased Independent Energy group revenue & higher average gas prices & oil volumes. Net income also reflects increased natural gas marketing & wholesale electric sales.

May 20, 2001

The well-publicized California energy crisis and President Bush’s energy plan have been very good for many utilities. Black Hills Corporation is a utility that primarily serves customers in South Dakota, Wyoming and Montana. However, the company does sell electricity throughout the western US. Earlier this month, BKH reported record profits of $1.37/share, which was an increase of 226% over the same quarter last year. The stock has been moving higher ever since the earnings report and on Friday the stock established a new high of $56.23. The strong share price may encourage the board to reward shareholders with a split. In the meantime, momentum traders might want to jump on this stock if it can establish yet another new high by trading above $56.23. This trade might be more attractive if the move is accompanied by midday volume exceeding 90,000 shares. The technical picture is improving. The MACD issued a buy signal last week and the Money Flow and the OBV are both moving higher off their lows. The RSI is indicating an overbought condition. However the last time the RSI was at a similar level, the stock kept rallying and the overbought condition became more pronounced. Initial support can be found at $54.00 followed by more support at the 20-DMA of $52.31. We are placing out initial stop at $52.25 to protect against a reversal.

Picked on May 20th @ $55.94
Change since picked +0.00
Stop Loss @ $52.25

May 24, 2001

BKH is right back in striking range of establishing a new high after pulling back modestly over the previous two trading sessions. Utility stocks, especially those based in the West, are benefiting from the California energy crisis. Additionally, BKH offers investors some real value for their investment dollars since the stock trades at a relatively low P/E of 17.38. The next trading opportunity could present itself tomorrow if BKH can establish a new high above $58.50, accompanied by midday volume exceeding 90,000 shares. In the event of a pullback, today's low of $57.00 should provide support. The MACD is positive and is suggesting that BKH can continue its advance. The RSI is suggesting an overbought condition. However, BKH has traded higher for extended periods in the past when the RSI was in overbought territory.

Picked on May 20th @ $55.94
Change since picked +2.11
Stop Loss @ $52.25

May 22, 2001

The potential for a split announcement grows every day that this western US utility increases its stock price. Granted, the stock slipped a bit today, but BKH started the week solidly by establishing a new high of $58.00 yesterday and extending those gains to $58.50 in today's trading before pulling back modestly. Traders are driving up BKH not only because of the split possibility (it has a BoD meeting next Wednesday), but also because of the increasing demand for energy that is well publicized by the California energy shortage. Momentum traders might jump on board again tomorrow if BKH can trade through $58.50 with midday volume exceeding 100,000 shares. If the stock happens to take a breather, look for it to possibly find support on its 5-DMA of $56.09. The technical indicators are a bit mixed. The MACD is positive and just recently issued a buy signal but the RSI is indicating an overbought condition. That said, traders might continue to drive the stock higher if the pattern of new highs is extended.

Picked on May 20th @ $55.94
Change since picked +1.91
Stop Loss @ $52.25