Signature Aviation : Back on its bullish trend
Entry price | Target | Stop-loss | Potential |
---|
GBX 183 |
GBX 0 |
GBX 176 |
-100% |
---|
BBA Aviation, the British multinational aviation services company, is testing its GBp 178 support area, might facilitate a technical rebound. The company’s fundamentals could validate this scenario.
From a fundamental viewpoint, the security is undervalued in terms of enterprise value. Based on the current price, its market capitalization, minus its net debt, represents 0.81 times its revenues. This valuation is just 11.13 and 9.72 times the two next years earnings.
Technically, in daily data, even if moving averages are still in a downtrend, the yesterday positive reaction in the GBp 178 area should stop this trend and allow a technical rebound towards GBp 196. Moreover, technical indicators show a significant oversold condition which strengthens this bullish scenario.
Considering technical and fundamental elements, it seems to be an appropriate timing to take immediately a long position in BBA Aviation in order to benefit from the valuation. The target price will be the GBp 196 resistance, ie a potential of 7% but a stop loss order will be placed under the mid-term support at GBp 178.
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