Schaeffer's "Behind the Headlines" Highlights the Following Stocks: Cigna, CVS Corp., Caremark Rx, Papa John's International, and Time Warner

Business Wire, Nov 1, 2006

CINCINNATI -- Today's "Behind the Headlines" from Schaeffer's Investment Research focuses on Cigna (NYSE:CI), CVS Corp. (NYSE:CVS), Caremark Rx (NYSE:CMX), Papa John's International (NASDAQ:PZZA), and Time Warner (NYSE:TWX). "Behind the Headlines" is a report that analyzes newsworthy stocks that are generating a lot of attention on Wall Street. "Behind the Headlines" is published on www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research.

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Behind the Headlines:

Cigna : Cigna (NYSE:CI) is starting November off on a good foot after boosting is 2006 earnings guidance and reporting a 15-percent surge in third-quarter net income. On a per-share basis, the insurer managed to handily top Wall Street's consensus view. CI shares shot higher out of the gate and have managed to take control of the 120 level, which had been thwarting recent rally attempts in the shares. In fact, the stock is now trading at its highest level since late April. The stock earns a Schaeffer's Equity Scorecard rating of 7.0 out of a possible 10, suggesting further upside potential over the near term.

Click the following link to see a daily chart of CI since June 2006: http://www.schaeffersresearch.com/wire?ID=17 662

CVS Corp.: Rumors were laid to rest this afternoon, when the official news came across the wire that CVS Corp. (NYSE:CVS) would acquire Caremark Rx (NYSE:CMX) for $21 billion, or 1.67 CVS share for every share of CMX. The combined company's board will be split 50/50, according to reports on CNBC. While CVS is currently halted, it was down by nearly seven percent on heavy volume at the time the deal was confirmed. The stock has been in a downtrending pattern since early September and was recently struggling with technical resistance at the 32 level. This coincides with peak call open interest at the 32.50 strike in both the November and December options series. The shares have not managed to close above this threshold of double-barreled resistance since October 4.

Click the following link to see a daily chart of CVS since September 2006: http://www.schaeffersresearch.com/wire?ID=17662

Click the following link to see the November open-interest configuration for CVS: http://www.schaeffersresearch.com/wire?ID=17662

Papa John's International: Last night, Papa John's International (NASDAQ:PZZA) entered the earnings confessional to report third-quarter results of 40 cents per share, a 21-percent increase over the previous year and 11 cents above analysts' expectations. The pizzeria lifted its 2006 forecast by three cents per share. Despite this good news, investors are focusing on one negative nugget - the fact that October domestic same-store sales dropped 1.8 percent. The stock recoiled in after-hours trading Tuesday and is currently off nearly 12 percent, dropping below a bevy of short- and intermediate-term moving averages, including its 50-week trendline. PZZA had not traded south of this moving average since January 2005. Short covering may soon come into play, as the sellers pocket profits from today and close their positions. As of the most recent reporting period, more than 18 percent of the company's available float was sold short, amounting to a short-interest ratio of nearly 20 days to cover. Short-covering action could play a sizeable role in any near-term recovery PZZA manages to enjoy.

Click the following link to see a weekly chart of PZZA since January 2005 with 50-week moving average: http://www.schaeffersresearch.com/wire?ID=17662

Time Warner : Massive media conglomerate Time Warner (NYSE:TWX) reported third-quarter earnings per share this morning that missed analysts' expectations by a penny. The shares are just fractionally lower this afternoon after catching support from their 20-day moving average but are finding their intraday high defined by the 20 level. This strike is a force to be reckoned with in the front three-months' series; in the November, December, and January series combined, there are nearly 200,000 open calls in residence. Volume at these near-the-money strikes has been notable as well today, with between 5,000 and 8,500 contracts trading on all three active options. Should the stock be unable to recover today above this structural resistance, it could find itself in a short-term trading range.

Click the following link to see the intraday chart of TWX: http://www.schaeffersresearch.com/wire?ID=17662

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