It didn’t take long for auto parts manufacturer DLPH to start heading in the right direction for us. On the morning we issued this alert – October 26^th – DLPH opened at $63.07, but quickly zoomed above $65 before closing the day out at $64.27. The only relevant news that day was the release of General Motors’ quarterly earnings report, which drove its share price down at the same time Delphi’s share price was on the rise.

Delphi is scheduled to report earnings tomorrow, so we will soon have a good idea if our thesis for buying it turns out to be correct. Over the past eighteen months, shares of DLPH have popped after each quarterly earnings release, but then gradually drifted lower as the cyclical nature of the auto industry outweighs the consistently strong operating metrics that Delphi has been able to generate.

For that reason, we don’t plan to stay in this stock any longer than necessary to achieve our target return. So keep an eye open for our alerts next week in case Delphi cranks out another strong quarter; once DLPH rises above $72, I am going to move the stop loss up to lock in our gain.