Buy Alert: July 2, 2013

Marcus Haber | July 2, 2013

Buy Alert: July 2, 2013

Trade Details

Buy Potash (POT) August $38 Calls for $1.15 or better

Why?

Potash, one of the primary fertilizers producers for the US and Canada, has fallen in recent weeks along with the price of grains. I believe it’s at or near a bottom.

For the most part, this is a technical trade. POT is at the bottom of a well-traveled range. And, it’s well below the key 200-day and 50-day moving averages. There appears to be a floor around $37 which should hold for fundamental reasons. You see, the company pays a solid dividend (3.7% yield) and carries a cheap overall valuation.

Savvy investors won’t let the shares fall too far without scooping them up at a discount. We could easily see the stock climb to the $40 level or above in a hurry.

Grab the POT August $38 calls now.