Foster Wheeler Ltd (FWLT) Naked Puts

I read a good bullish article on Foster Wheeler (FWLT) in the June 18^th issue of Barron’s.  It was actually a follow-up on a previous story they ran a while back.  I forgot to bring it in to work to quote it exactly, but in short it said they have a lot more room to grow with gas prices up and even if gas prices dip some.  One analyst gave a price target of 140.  I mentioned FWLT last week when I said I bought my option back for a loss in January only to see the stock double within 5 months.  I decided to stop missing out on the action and while FWLT was trading at $107.77 this morning, I sold one August 105 naked put (UFBTA) and received $549.25 after commissions.  That puts my cost if assigned just under $100.  It’s up a little this morning and if it does turn south I see support from two trend lines around 105 and climbing.  If FWLT breaks through those lines, 100 should be the next support level.  Schaeffersresearch.com rates FWLT 6 out of 10.  That’s not as high as I’d like it to be, but it’s still on the bullish side of neutral.

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