Schaeffer's Street Chatter Highlights the Following Stocks: Corinthian Colleges, Papa John's International, and Verizon Wireless

Business Wire, Sept 1, 2004

CINCINNATI -- Today's "Street Chatter" from Schaeffer's Investment Research focuses on: Corinthian Colleges (Nasdaq:COCO), Papa John's International (Nasdaq:PZZA), and Verizon Wireless (NYSE:VZ). "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. According to Hoover's, Corinthian Colleges (Nasdaq:COCO) is a for-profit education company boasting about 150 colleges and training centers in the United States and Canada with an enrollment of more than 43,000 students. Earlier today, the company announced a fourth-quarter revenue surge of 56 percent to $217.1 million. Fiscal-year 2004 revenue advanced 55 percent. On the earnings front, the company collected 20 cents per share, matching year-ago results and edging past analysts' expectations by a penny per share.

On August 2, COCO shares plunged dramatically lower after reporting that its fourth-quarter results would be below prior expectations. The stock has regained some of these losses today, rallying almost 13 percent, but several layers of technical resistance still reside overhead. First is the 21.34 level, which defines a 50-percent retracement point between the equity's September 2001 nadir and its April 2004 high. Next is the 17.565 mark, a "half high" from this recent peak. The 17.565 level is also near the site of the security's descending 10-week moving average.

Sentiment indicators aren't reflecting quite as much pessimism as we would normally like to see for a stock experiencing fading price action below a stiff bulwark of resistance. The Schaeffer's put/call open interest ratio (SOIR) for COCO weighs in at 0.77, which is lower than 57 percent of the past year's worth of readings. Short interest is hardly worth mentioning, as the seven million COCO shares sold short could be covered in less than one day's worth of trading at the equity's average daily volume. Finally, Wall Street maintains three "buy" ratings on the stock, along with seven "holds" and a solitary outright "sell" rating.

Click the following link to see the Weekly Chart of COCO Since September 2001 With 10-Week and 20-Week Moving Averages: http://www.schaeffersresearch.com/wire?ID=10998 .

2. Tuesday evening, Papa John's International (Nasdaq:PZZA) reported a 1.2-percent decline in same-store sales figures for August. The company cited severe weather in the Southwest United States as part of the reason behind these lackluster figures. Total sales managed to turn 6.5 percent higher on a year-over-year basis.

PZZA shares are trading moderately higher today, suggesting that the same-store sales disappointment may have already been expected by the Street and investors. The shares embarked upon a decline in late February but entered a sideways consolidation pattern in late April, which has been capped by the equity's descending 20-week moving average. For more than three months, PZZA has been wedged in a 10-percent trading range between the 28 and 31 levels.

Options players have not warmed to PZZA, as there are currently less than 500 open option contracts in the front three months' series. Short sellers, on the other hand, have collected over four million shorted PZZA shares, accounting for more than one-third of the equity's float available for public trading. Assuming PZZA could ever resolve its sideways pattern to the upside, it would take these bearish investors more than one month, at the stock's average daily trading volume, to close all of these shorted positions. Analysts have also avoided the equity. According to Zacks (www.Zacks.com), there are only three brokerage firms covering the stock, two of whom name PZZA a "hold" and one who lists it as an outright "sell."

Click the following link to see the Weekly Chart of PZZA Since October 2003 With 10-Week and 20-Week Moving Averages: http://www.schaeffersresearch.com/wire?ID=10998 .

3. Wednesday's New York Post said that Bain Capital is nearing an agreement to acquire Verizon Communications' (NYSE:VZ) Canadian telephone directory services for more than $1 billion. VZ shares are not reacting to this fundamental development, hovering at the breakeven mark in midday trading. The equity shot higher at the end of July following solid second-quarter earnings-per-share figures. VZ has subsequently retained its gains along technical support from its 10-day and 20-day moving averages.

Hovering overhead, however, is heavy out-of-the-money call open interest at the 40 strike. In the September series, there are more than 37,000 open call positions, while the October 40 strike boasts about 33,000 open calls. The equity's SOIR has been moving lower since late July, implying increased interest for call positions (or decreased interest for put positions). The sentiment indicator now stands in the bottom one-third of the past year's worth of SOIR readings at 0.53.