June 26th 2006 - NWL

Dykstra picked the December 20 Call for NWL Newell Rubbermaid Inc.
Read the column here.

Option price: $6.50 (or better)
Stock closing price: $26.07
Approximate premium: .43-cents ($26.07 - (Strike $20 + $6.50 = $26.50) = .43-cents)

Dykstra mentions the closing price on Friday of $26.14. The stock closed down today at $26.07 and the option price hit the target of $6.50 with volume of 39 options. The current bid is $6.40 with the current ask at $6.60, so the game is on already with this one.

June 29th Update - NWL closed at $25.80 today, up .33-cents. The option ask price is $6.20 with a bid of $6.00.

July 17th Update - In today's column Dykstra recommended a double down on NWL since the option value has lost around $2 to lower the average cost down from $6.50. Currently the option is trading at $5.00 with a bid of $4.80. Cramer is also bullish on the stock, and I believe he owns it for his charitable trust.

July 17th Update - NWL reported reported strong earnings today and the stock price was well up. The option traded as high as $7.41 today, but has since fallen back down to $6.80. Based on Dykstra's original purchase price we are still off 9-cents from hitting the target, but based on his recommended double down he has hit his target today. Now I am inclined to hold off saying he has hit his target because I'm sure not everyone has another $4000 to use to double down on a losing position so I would like to see the option go to $7.50. Either way though, Dykstra did make a good call here and was brave enough to stick to his guns and suggest the double down.