J D Wetherspoon plc : An appropriate purchase level
By Etienne Veber
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
GBX 758.04 | GBX 0 | GBX 739.8 | -100% |
From a fundamental viewpoint, the security is strong. Besides, EV/Sales is low with a ratio at 1x for this year.
Technically, the security is in a negative configuration in the short term as the bearish trend of 20-day moving average, currently at GBp 764.1, shows. Nevertheless, the stock seems in an oversold situation, near to its GBp 749.5 support in daily data, because it was 1% down in the last trading sessions. This level might stop the bearish trend in the short term.
In order to make the most of a potential technical rebound of JD Wetherspoon, it seems opportune to open a long position at current prices. A confirmation of this pattern would enable the security to reach the GBp 783.5 resistance, with a potential gain of 5%. Investors should not insist under GBp 749.5 and are better of placing a stop loss order under this threshold.