Schaeffer's Street Chatter Highlights the Following Stocks: Able Laboratories, CREE, and InterDigital Communications

Business Wire, Nov 11, 2004

CINCINNATI -- Today's "Street Chatter" from Schaeffer's Investment Research focuses on: Able Laboratories (Nasdaq:ABRX), CREE (Nasdaq:CREE), and InterDigital Communications (Nasdaq:IDCC). "Street Chatter" is a report that analyzes three newsworthy stocks that are generating a lot of attention on Internet message boards. "Street Chatter" is published on www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research.

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Street Chatter:

1. Able Laboratories (Nasdaq:ABRX) is a generic pharmaceuticals firm with a list of products that include a generic equivalent of popular attention deficit disorder drug Ritalin. The company's other drugs target pain, inflammation, and cardiovascular problems, as well as neurological issues such as attention and manic-depressive disorders. Since hitting a January low of 15.60, the shares have slowly ground higher into resistance at the 22 level. From a longer-term perspective, the equity is currently resting on support at its rising 20-month moving average. The stock has not suffered a monthly close below this trendline since September 2002. A bounce off this support line could help to shove the security through overhead resistance.

This drug company continues to hover beneath the radar of most traders and the Street. According to Zacks, only one analyst currently follows the firm with a "buy" rating. Any additional coverage could add some lift to the stock's rally. Despite the fact that short interest plunged 15 percent in October, more than 12 percent of the equity's float remains sold short. At the security's average daily trading volume, it would take almost 16 days for the bears to cover these pessimistic positions. An unwinding of these bearish bets could easily fuel a significant rally in the stock. According to our Equity Scorecard (available via Schaeffer's Gold), the stock carries a rating of 8.0, making this an attractive bullish play.

Click the following link to see both the Equity Scorecard and Monthly Chart of ABRX Since April 2002 with 20-Month Moving Average: http://www.schaeffersresearch.com/wire?ID=11720.

2. According to Yahoo! Finance, Cree (Nasdaq:CREE) develops and manufactures semiconductor materials and devices based on silicon carbide (SiC), Group III nitrides (GaN), silicon and related compounds. The firm's SiC and GaN materials technology is the basis for many of the devices that it develops and produces. CREE focuses its expertise in SiC and GaN materials on four product areas: light emitting diodes (LEDs), including blue, green and near ultraviolet (UV) LED chips and high-power packaged LEDs; power switching products; radio frequency (RF) and microwave devices, and near UV lasers. Pessimism abounds on this tech stock. The equity's Schaeffer's put/call open interest ratio (SOIR) checks in at 0.99, as puts nearly equal calls in the front three months of options. What's more, this reading is higher than 89 percent of all those taken over the past year. Furthermore, the number of CREE shares sold short jumped six percent higher over the most recent reporting period to 20.4 million shares - its highest level since January. This accumulation of bearish bets accounts for more than 28 percent of the stock's float and is more than six times its average daily trading volume. Wall Street even has its doubts about the company, as six of the eight analysts following CREE rate it a "hold" or worse.

This wealth of pessimism seems greatly misplaced when you consider the security's technical performance. On a monthly basis, CREE has outperformed the Nasdaq Composite since July 2003. Since July of this year, the shares have rallied along the support of their 10-day and 20-day moving averages, more than doubling in price. Over this time period, the equity has also enjoyed the steadfast support of its rising 10-week trendline. This combination of technical strength and investor pessimism has resulted in an Equity Scorecard rating of 7.0. CREE may still have further upside ahead of it as this mound of pessimistic sentiment unravels in the form of increased buying pressure.

Click the following link to see the Equity Scorecard and Daily Chart of CREE Since July 2004 with 10-Day and 20-Day Moving Averages: http://www.schaeffersresearch.com/wire?ID=11720&obspage=2.

3. InterDigital Communications (Nasdaq:IDCC) develops and licenses circuitry designs, software, and other technology using CDMA and TDMA (code- and time-division multiple access) wireless telecommunications standards. The company is also developing microchips and software to enable voice and data transmissions in mobile phones and portable computing devices. From a technical perspective, the stock has finally broken free. Since mid-August, the shares were range bound between resistance at 17 and support at 15.50. However, the equity has finally broken above overhead resistance and is currently poised to finish the week above its 10-week and 20-week moving average for the first time since late July. Looking ahead, the shares must still contend with their 10-month (at the 18 level) and 20-month (at the 19 level) moving averages. These long-term trendlines have capped the stock's monthly closes since February.