Walmart Inc. : The USD 74.9 area might facilitate a technical rebound
May 28, 2015 at 07:50 pm IST
By
Entry price | Target | Stop-loss | Potential |
---|
US$75.19 |
US$0 |
US$73.53 |
-100% |
---|
In the past few sessions, Wal-Mart Stores share have suffered from a sharp fall and is now coming back to significant level support.
From a fundamental viewpoint, Wal-Mart Stores seems undervalued in terms of enterprise value. Based on the current price, its market capitalization, plus its net debt, represents 0.58 times its revenues.
Its P/E ratio are low at 15.71 and 14.96 times the two next years earnings.
Technically, in daily data, even if moving averages are still in a downtrend, a positive reaction in the USD 74.9 area should stop this trend and allow a technical rebound towards USD 77.65/79.9. Moreover, technical indicators show a significant oversold condition which strengthens this bullish scenario.
Therefore, the proximity of the USD 74.9 support is an opportunity to go long on Wal-Mart Stores. The first goal is a return in the USD 79.9 resistance area, that is a potential of 6.9%. A stop loss order can be placed under the support currently tested.
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