Put Spread on JNJ on 4/26/2013

Johnson & Johnson is a holding company. The Company is engaged in the research and development, manufacture and sale of a broad range of products in the health care field. The business of Johnson & Johnson is conducted by more than 275 operating companies located in 60 countries, including the United States, which sell products in virtually all countries throughout the world. The Company's primary focus has been on products related to human health and well-being. The Company is organized into three business segments: Consumer, Pharmaceutical and Medical Devices and Diagnostics. The Company's subsidiaries operate 146 manufacturing facilities occupying approximately 21.6 million square feet of floor space. In March 2013, Johnson & Johnson's Cordis Corporation announced the acquisition Of Flexible Stenting Solutions, Inc.

Stockwinners is bearish on this name for the following reasons :

1. After today's disappointing GDP data, a modest correction is expected during next week.
2. The chart is way over extended. In the last week we have seen similar low growth, defensive names like PG, BMY, AMGN & PFE all come crashing down from 52 week, or all time highs on the slightest bit of bad news.  Our sense is that as the multiples get very stretched and the realization of lower than expected global growth and continued currency headwinds sink into the investment equation for staples and healthcare stocks, investors may quickly head for the doors at the first sign of broad market weakness.
3. The trade is going to be profitable if stock goes down by even as low as 1% by May expiration.

Trade Buy 1 May $85.00 Put at $1.00 Sell 1 May $82.50 Put at $0.30 For a net debit of $0.70 Profit/Loss Analysis Breakeven at $84.30 Maximum profit is $180.00 at strike of $82.00 Maximum loss is ($70.00) at strike of $85.00 Closing Summary Sold 1 May $85.00 Put at $0.00 Bought 1 May $82.50 Put at $0.00

Position closed on 5/17/2013 at price of $0.00 with a -100.00% loss in 21 days.

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