The purpose of this analysis is to inform readers about those companies that, after a temporary decline, are ready to follow the underlying positive medium-long term trend based on the target price expected by analysts.
In each “card” supplied with the company chart it is possible to find information on analysts’ expectations about the future of the company.
In particular, ideal companies should possess the following characteristics:
- positive medium-long term price trend
- signs of recovery after a temporary decline lasting a few days / week
- analysts expect further stock price growth in the coming months
- analysts expect growth in EPS (Earnings-Per-Share) over the next 5 years
- in the last quarterly report the company reported higher EPS than analysts’ expectations
Differences with the real “buy the dip” strategy
Generally the “buy the dip” strategy refers to buying shares of a company during a decline. This analysis differs because the potential entry point is after the decline has stopped and the stock price is ready to returning in the direction of the main positive trend.
The pause of a trend does not guarantee a subsequent continuation, but may indicate the beginning of a negative trend. I recommend using this information as a starting point to integrate with your own analyzes (on fundamentals, volumes, etc.).
Constellation Brands Inc (STZ)
Crestwood Equity Partners LP (CEQP)
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This analysis tries to identify those companies that are ready to resume the positive trend. If you are interested in analysis on more precise chart patterns (such as breakout / rebound of trend-line, supports, resistances and moving averages) click here.
If you are also interested in analysis of company fundamentals, I refer you to my Score-Card analysis here.
To learn about all the types of analysis you find on BullDude.com click here
Sources & additional info
For each company the relative graph and a “card” containing the following information will be shown:
- Target price set by the analysts and the consequent Up / Downside potential as a percentage of the current price is indicated.
- Expected annual growth rate of Earnings-Per-Share (EPS) in the next 5 years.
- EPS Surprise, or how much the EPS (Earnings-Per-Share) reported in the last quarter were higher/lower than the analysts’ expectations.
- General information on the company as Market Cap., Industry and Dividend Yield.
*Charts by Tradingview (the black line represents the S&P 500 index)
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DISCLAIMER: The information in this blog post represents my own analysis/opinions and does not contain a recommendation for any particular security or investment.