Redrow plc
RDW
Delayed London Stock Exchange - 06/27 05:35:02 pm
548.5GBp
-0.54%

The revival in interest should continue

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Jordan Dufee
 

Strategy published on : 04/21/2017 | 10:00

long trade
Live

Entry price : 559£
Target : 630£
Stop-loss : 525£
Potential : 12.7%

Shares in Redrow plc have recently benefitted from a regain of interest by market participants. The technical chart pattern suggests a continuation of the upward movement.
Summary

● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.

● In a short-term perspective, the company has interesting fundamentals.


Strengths

● The group's activity appears highly profitable thanks to its outperforming net margins.

● Predictions on business development from analysts polled by Thomson-Reuters are tight. This results from either a good visibility into core activities or accurate earnings releases.

● The group usually releases upbeat results with huge surprise rates.

● The equity is one of the most attractive in the market with regard to earnings multiple-based valuation.

● Upward revisions of sales forecast reflect a renewed optimism among the analysts covering the stock.

● Over the last twelve months, the sales forecast has been frequently revised upwards.

● For the last 4 months, the company has been enjoying highly positive EPS revisions, which were frequently and significantly raised.

● For the past year, analysts covering the stock have been revising their EPS expectations upwards in a significant manner.

● Analysts have a positive opinion on this stock. Average consensus recommends overweighting or purchasing the stock.

● The stock is in a well-established, long-term rising trend above the technical support level at 414.2 GBp


Weaknesses

● The share is close to its long-term resistance in weekly data. Therefore, the potential should be limited. However, a further bullish movement when crossing this resistance will be a positive signal.

● The company is not the most generous with respect to shareholders' compensation.

Zonebourse.com 2017
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