[0] Schaeffer's Option Activity Watch Features AdvancePCS, American Power Conversion, Sohu.com.

Business Editors

CINCINNATI--(BUSINESS WIRE)--Feb. 3, 2004

Today's Schaeffer's Option Activity Watch features AdvancePCS (Nasdaq:ADVP), American Power Conversion (Nasdaq:APCC), and Sohu.com (Nasdaq:SOHU). The Option Activity Watch is a report that takes a closer look at three equities appearing in our most unusual option activity report from the previous day. The Option Activity Watch is published on www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. For additional information about this report or to have it delivered to you free via email every day click on the following link: http://www.schaeffersresearch.com/addinfo .

Schaeffer's Option Activity Watch:

1. According to Hoovers, AdvancePCS (Nasdaq:ADVP) provides pharmacy and health management services for health plans. The firm offers mail-order pharmacy programs, disease management programs, information management, and prescription drug services. This Fortune 500 company has seen an increase in pessimism from options players, as its Schaeffer's put/call open interest ratio (SOIR) checks in at 0.74. This reading is higher than 91 percent of those taken over the past year. In fact, open interest at the stock's February 55 put jumped from 548 to 3,822 contracts overnight. Wall Street also has its doubts when it comes to ADVP, with eight of the 12 analysts following the firm rating it a "hold" or worse. Meanwhile, short interest dipped by 10 percent over the most recent reporting period to 2.2 million shares. This is less than two times the stock's average daily trading volume, reducing the chances of the security enjoying a covering rally. It's surprising to see this swell of pessimism considering that ADVP has outperformed the Nasdaq Composite (COMP) since March 2000. The stock has risen on support from its 20-week moving average since October 2002 and is trading near its all-time high. An unraveling of existing pessimism toward the shares could help to fuel the security's rally higher. However, ADVP must still break through resistance at the 60 level. This strike is the site of peak front-month call open interest with 7,600 contracts and could hinder the security's rally attempts.

Click the following link to see the Weekly Chart of ADVP since August 2002 with 10-Week and 20-Week Moving Averages: http://www.schaeffersresearch.com/wire?ID=9381 .

2. American Power Conversion (Nasdaq:APCC) produces uninterruptible power supply devices, surge protectors, precision cooling products, and related items. The stock has also been a strong performer, with its relative-strength measure versus the COMP soaring higher since October 2000. The security recently dipped below its 10-day and 20-day moving averages, but is sitting on key support at its 10-week trendline. APCC has risen on support from its 10-week and 20-week moving averages since May. Despite its technical strength, investors remain skeptical of the shares. The equity's SOIR sits at 1.03 and is higher than 91 percent of those taken over the past year. What's more, the stock's February 25 put added more than 2,200 contracts yesterday. Furthermore, short interest currently sits at a two-year high at 5.1 million shares. At the security's average daily trading volume, it would take more than four days to cover these bearish bets. A continuation of the stock's rally could force pessimists to cover their positions, pushing APCC even higher. In addition, the company is slated to report earnings on February 5, with the Street anticipating a profit of 27 cents per share, a 17-percent improvement over earnings for the same period a year ago. Historically, the firm has met or surpassed the Street estimate for the past five quarters. Another positive report could also help to shake loose some of the bears.

Click the following link to see the Weekly Chart of APCC since May 2003 with 10-Week and 20-Week Moving Averages: http://www.schaeffersresearch.com/wire?ID=9381 .

3. Chinese Internet stocks took a beating this morning after Sohu.com (Nasdaq:SOHU) reported fourth-quarter earnings of 28 cents per share, besting its profit of five cents per share for the same period a year ago. The company also expects first-quarter earnings of 27-29 cents per share on revenue of $25.6-26.6 million. SOHU operates China's leading Web portal and directory. The company offers both a search engine and 17 content channels as well. Investors were optimistic ahead of the company's earnings report, with open interest at the stock's March 40 call tacking on more than 7,300 contracts. What's more, calls more than double puts in the front three months of options, giving the stock a SOIR of 0.44. This ratio is lower than 84 percent of those taken over the past year. Short interest also continues to inch lower and now sits at 4.0 million shares, resulting in a meager short-interest ratio of 1.47 days to cover. The stock continues to fly below Wall Street's radar with only one analysts following SOHU. Any additional coverage could help to boost the shares. From a technical perspective, the security gapped sharply lower today, yet remains in the sideways channel that has trapped the shares since June. Traders should key in on the 28 level, as a break below here could force the bulls to unload some of their optimistic bets.

Click the following link to see the Weekly Chart of SOHU since May 2003: http://www.schaeffersresearch.com/wire?ID=9381 .

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .