DCC plc : Towards the breakout of a major resistance level
BUY
Conditionne
Stop-loss triggered
Entry price | Target | Stop-loss | Potential |
---|
GBX 7,180 |
GBX 8,000 |
GBX 6,940 |
+11.42% |
---|
DCC plc shares are trading close to a major technical resistance, which, if broken, could yield new upside potential and an increase in volatility. This scenario can be anticipated.
Summary● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
● The company has solid fundamentals for a short-term investment strategy.
Strengths● There is high visibility into the group's activities for the coming years. Outlooks on future revenues from analysts covering the equity remain similar. Such hardly dispersed estimates support highly predictable sales for the current and upcoming fiscal years.
● The stock, which is currently worth 2017 to 0.54 times its sales, is clearly overvalued in comparison with peers.
● For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
● Analysts covering this company mostly recommend stock overweighting or purchase.
Weaknesses● Stock prices approach a strong long-term resistance in weekly data at GBp 7165.
● Technically, the stock approaches a strong medium-term resistance at GBp 7175.
● The group usually releases earnings worse than estimated.
● The firm trades with high earnings multiples: 25.7 times its 2017 earnings per share.
● The company is not the most generous with respect to shareholders' compensation.
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