West Fraser Timber Co. Ltd. : Continuation of the bullish trend
March 15, 2013 at 09:41 am
By
Entry price | Target | Stop-loss | Potential |
---|
$87.38 |
$0 |
$84.4 |
-100% |
---|
The stock of West Fraser Timber could reach new historical highs.
From a fundamental viewpoint, the company is strong. It has a reasonable valuation with an EV/Sales ratio of 0.95x. The Thomson Reuters consensus revised regularly upward EPS estimates of the company for the current year.
Technical patterns are in the green: prices are up for several months. The trend should continue in the coming trading sessions. The stock is, now, near the CAD 84.75 short term resistance which is corresponding to the 20-day moving average and the low limit of the bullish channel. Thus, the security should bounce towards CAD 92.5.
Thanks to these good indicators, it seems relevant to take a long position in West Fraser Timber at the current price. The target price is the CAD 92.5. Once this level reached the stock could continue its rise towards new highs. A stop loss will be fixed under the CAD 84.75 short term support because a breakdown of this level would damage technical pattern.
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