I took a new position in Dunkin Brands (DNKN) at around $30.04 just before the close on Friday. Not just because I like donuts, but because of the strength in the last couple days after news of a stock sale by private investors. The positive action tells me there is good demand for the stock. This is a relatively new stock and there is an expectation that earnings will grow significantly over the next year.
Technically, the stock is in a good position. It bounce off its 50 day moving average twice over the past two days and rebounded nicely. $30 is historical support, which it broke out of in early March. There is a nice uptrend in place from mid December. I'm looking for the stock to hold the 50 day ma and uptrend line as support. A breach of the 50 day ma will stop me out.
My initial target is around $32. If it breaks that level, $34-35 could be realized shortly after.
Enjoy the weekend!
~JP
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