Constant Contact Inc : Wait for the breakout
By Etienne Veber
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
US$27.64 | US$31 | US$26.9 | +12.16% |
From a fundamental viewpoint, the group is in a good financial situation. Sales have increased by +13% in 2012, with a net margin of 5.06%. Analysts widely revised upward in recent times their earnings per share estimates, which is a reliable indicator reflecting the company's health.
Graphically, the security is up 85% since the 1st January. It seems able to continue this uptrend supported by moving averages and will soon test the USD 28.15 mid-term resistance. We anticipate a breakout of this level, given the upward orientation of the stock in the medium and long term. Above USD 28.15, a buy signal will be given.
According to these elements, most active investors could take a long position at the crossing of the USD 28.15 resistance for a new bullish signal. A stop loss will be placed below the 20-day moving average, threshold that would invalidate the bullish strategy.