Equity Clock

Motorola Inc (NYSE:MOT) – Clock That Stock

Clock_That_Stock

The Stock

Motorola Inc (NYSE:MOT) announced last night of its plans to spinoff into two entities. According to the Associated Press “one company will focus on consumer products, including cell phones and set-top boxes, while the other develops communications networking products for business customers.” The stock rallied on Friday to punch out an 8.5% gain by mid-day. Certainly not the stock that it once was during mid part of last decade, this stock has been subject to increased competition from major players in the industry snatching up market share, Apple with their iPhone being one of them.

Analysts believe that the split will provide the company a clearer direction for each of its newly created entities and strategically align their focus on the respective products they intend to compete with in the marketplace. The rally today has given this equity the strength to close in on its 50-day moving average, diminishing the amount of upside potential to expect from its current valuation. The high-side limit within the probable short-term trading range is $7.93, leaving some room to run, but remember with meager long-term growth expectations at around 5% and earnings per share figures that have been struggling as of recent, how far can this investment really go without further increased innovation in an industry that is continuously evolving.

Chart Courtesy of StockCharts.com

The Clock

This stock follows a different seasonal pattern than that of the sector in which it operates. The technology sector commonly tops out near mid January, having begun sometime in October. However, this equity follows an alternate path. This stock has shown a history of bottoming out around mid April and finding strength that runs through until the summer. Based on this you would expect a pullback from current levels in the near future before finding seasonal influences throughout the spring.

Motorola Inc (MOT) 6.65

+ 0.02 (0.3%)

Seasonality Analysis

Analysis has revealed that with a buy date of April 14 and a sell date of August 27, investors have benefited from a total return of 265.92% over the last 10 years. This scenario has shown positive results in 5 of those periods.

Conversely, the best return over the maximum number of positive periods reveals a buy date of April 14 and a sell date of June 4, producing a total return over the same 10-year range of 146.87% with positive results in 9 of those periods.

The buy and hold return for the past 10 years was -80.31%.

Technical Analysis

Support 2

Support 1

Pivot Point

Resistance1

Resistance2

The Numbers

6.53

6.59

6.63

6.69

6.73

Most Recent Close:

6.65

Support/Resistance Analys

Neutral

52-Week High:

9.45

MACD Analysis:

Negative/Increasing

52-Week Low:

2.98

MACD vs. Signal:

Above/Widening

Fib. Retracement:

~ 61.8%

RSI Analysis:

Below 50

50-Day MA:

7.61

Stochastic (Fast) Analysis:

Neutral

200-Day MA:

7.39

50 vs 200-Day MA Analysis:

50-day Above 200-Day MA

High Critical Level:

7.93

Year over Year Trend:

Strongly Gaining

Low Critical Value:

6.38

Critical Level Analysis:

Within Critical Levels

Average Monthly Gain:

5.9%

MFI Analysis

Bullish Centerline Crossov

Technical Rating:

Candlestick Analysis

Bullish

On a scale of 1 to 10, the higher the rating, the more appealing the investment is to buy at current levels.

Situational Analysis

Past Year

Advancing Sessions %

Return %

10-Year Average

Advancing Sessions %

Return %

Feb 11 thru Mar 13

38.1

-3.8

Feb 11 thru Mar 13

40.5

-3.4

Best Return: -0.5% – Sell Feb 12

Best Return: 4.9% – Sell Feb 20

Feb 11 thru May 12

48.4

55.6

Feb 11 thru May 12

46.2

-0.5

Best Return: 66.7% – Sell May 8

Best Return: 15% – Sell Mar 18

Feb 11 thru Aug 10

83.8

Feb 11 thru Aug 10

4.7

Best Return: 85.9% – Sell Aug 3

Best Return: 23.1% – Sell Apr 28

Four Year Presidential Cycle: Through Mid-Term Election Years

Following Earnings Release

5-Period Average

Advancing Sessions %

Return %

14-Period Average

Advancing Sessions %

Return %

Feb 11 thru Mar 13

50.2

2.2

Oct 28 thru Nov 27

45.5

-1.8

Best Return: 7.1% – Sell Feb 28

Best Return: 7.9% – Sell Nov 8

Feb 11 thru May 12

50.1

4.6

Oct 28 thru Dec 27

47.1

-2.5

Best Return: 15.1% – Sell Apr 3

Best Return: 11.4% – Sell Nov 19

Feb 11 thru Aug 10

48.9

4.5

Oct 28 thru Jan 26

-4.3

Best Return: 20.1% – Sell Apr 18

Best Return: 14.5% – Sell Nov 29

Further Analysis

Sector:

Technology

Industry:

Communication Equipment

According to Thackray’s 2010 Investors Guide, the period of seasonal strength for the Technology Sector ranges from October 9th through to January 17th. The seasonality ends around the time of the Consumer Electronics Show at the beginning of January and before earnings are finished being reported for the previous quarter in which holiday sales contributes significantly to the bottom line.

Current Consensus Recommend:

Outperform

Recommendation 1-Month Ago:

Outperform

Recommendation 3-Months Ago:

Outperform

Disclaimer

Analysis, comments, calculations, and opinions offered in this report, available via EquityClock.com, are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed.