Watch List 9/18- MTN

MTN is going to be a tricky horse.
It is my plan to short/ purchase puts on this stock if it seems to top out just start to wander down on Friday. If on Friday there is a sudden drop before I get it, then it is too late. If I see this stock still climbing throughout Friday, I will do nothing and observe on Monday.
This baby could bite. I am already starting to go outside my comfort level due to the fact that this stock got upgraded to strong buy via  Zack's. Usually I do not touch stocks for two weeks after an upgrade or downgrade. The strong buy could push this thing up further Friday and possibly monday. So I need to see the price action  on both Friday and Monday to see if the Zack's upgrade has already been factored in and if the stock is running out of upward steam. However, it looks like its possible to make some decent money on this stock if it has lackluster earnings. Lets take a look at its analysts estimates for its upcoming earnings report next week:

Now here are my thought processes:

1. There has been an unusual jump a few days ago with the stock based on forward news. Vail isn't going to see money from this right away. As a matter of fact, they paid a lot of cash out for this new moutain. When forward looking good news comes out like this, people tend to overreact and the stock tends to get overbought.
2. However, Zacks put out a strong buy on this stock. This causes stragglers over the course of the next few days to the next week to pile on, causing the price to keep wandering up. Thats why typically I dont deal with stocks that have been upgraded or downgraded during the previous two weeks. It kills bounces for the most part. And that is how I make my money. Contrarian bounces, trading against the crowd and having the stock bounce back to its correct valuation over the course of the next few days when the stock once again becomes correctly valued.
3. This stock is due to have a lackluster earnings report. Look at the Growth Est part of the chart above for the current quarter and compare MTN against the Industry, Sector and the S+P 500. Its lacking on all fronts. With this alone, the stock if it has been climbing incorrectly up to earnings due to a crowd momentum play, should report and the stock should then drop in value. However, it is not a really big negatige expectation, but against the rest of the industry and sector, its low.
4. However the Zacks upgrade and the good news might significantly dampen the downward drop of this stock when it reports.
5. If you look above at the last 4 quarters of earnings surprises, there has been negative surprises for the last 3 out of 4 quarters. That works in our favor. If the stock misses in negative territory, people punish the stock by selling it off.
6. So I believe what it will come down to is price action. If this thing is showing via its candlestick charts that the Zacks upgrade and the news has already been priced in, its going to waffle around the top where it is now. I would then purchase puts on it near the close of Fridays trading. If it keeps going up Friday, I would then make my final decision Monday morning, after further review of its price action.