Connect with us

Stocks

Rockwell Automation Corp. (NYSE: ROK) trading pattern you need to know now

Published

on

Today?s object of technical analysis is Rockwell Automation Inc. (ROK). After one does a thorough job of checking for chinks in the armor on the fundamental side, the work of due diligence is only just beginning. The next step is to make sure the technical character of the chart matches the story in an advantageous way. We will look at some of the key points in that analysis today for ROK.

First off, when looking at the overall directional impact of recent money flows, we will use the relative positioning of the 50-day and 200-day simple moving averages. In other words, if the 50-day moving average is trading above the 200-day, it is traditionally seen as a bullish chart trend. Conversely, if the 50-day moving average is trading below the 200-day, it is traditionally labeled a bearish trend or bearing.

In this case, for ROK, that adds up to a bullish designation, which suggests that flows have been working in an overall positive direction on the chart. With that established, the question now turns to whether or not key indicators suggest the action has pushed too far too fast, leading to a statistically likely mean-reversion probability going forward.

For that, we rely on our key overbought/oversold oscillators. There are many out there, but we prefer the 14-day Relative Strength Indicator (RSI) and the 20-day ?fast stochastic?. For both of these measures, if we see a score above 75 (overbought) or below 25 (oversold), history suggests one is wise to expect some reversion to the mean. For ROK, the 14-day RSI shows a score of 85.05%, while the 20-day fast stochastic shows a score of 82.25%.

From there, we want to next turn our attention to relative performance and volatility scoring, or Beta. Rockwell Automation Inc. has moved +25.43 over the past month or so. Over the trailing 100 days, the stock is outperforming the S&P 500 by 21.65.

This movement has come on a more volatile bearing from one day to the next relative to the broader market, according to the stock?s 36-month beta. In addition, we can see that the stock?s recent action has come on a historical volatility score of 34.29% (as indicated by taking the standard deviation of returns for a random trading input assuming buying the stock at a given average price during the specified period). Furthermore, the 20-day ATR as a percentage of the 20-day moving average grants another key view into relative volatility scoring. By that measure, we reach a score of 1.69%.

That brings us neatly to an examination of key levels of support and resistance on the chart. For this, we generally bias toward range markets, fib levels, and moving averages. In any of these cases, it?s important to understand that the concept of support and resistance is a bit like what we might call ?social gravity?. It?s a game theory concept. It?s the point where people assume other people will be acting.

Keynes called this type of logic the beauty contest. The idea is based on a fictional newspaper contest in which people are asked to pick which of a series of pictures of women?s faces will be the most popular picks for ?most beautiful?. Given that the winner will be someone who guesses what other people picked the most, the goal has nothing to do with picking the most beautiful face. It is figuring out which picture the most other people will think the most other people will think is the most beautiful. This is called ?recursive logic?. And it forms the basis for key support and resistance in markets as well.

In short, popular meeting points on the chart tend to be established either where they have been before (range extremes), or at key Fibonacci levels or moving averages. In this case, the critical 38.2% level drawn off the 52-week high of $210.72 sits at $175.01. ROK also has additional resistance above at the stock?s 200-day simple moving average, which sits at $ 161.93.

Lastly, we need to quickly cover relative volume. Here, we want to examine relative volume measures to get a feel for interest in the stock of late. Right now, this stock has been showing weak relative volume, which indicates lack of interest among those making a market for shares of the stock, and that should be seen as a key factor in drawing conclusions about your level of interest as well.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Stocks

CA, Inc. (CA) Could Be In For A Major Breakout

Published

on

Stock of CA, Inc. (CA) opened at $32.26 and last traded at $32.12 x 800. More than 693,693 shares exchanged hands compared to an average daily volume of 1,677,896 shares. At the current pps, the market capitalization stands at 13.41B.

TriNet Group, Inc. (NYSE: TNET), a leading provider of comprehensive HR solutions, today announced that Richard Beckert has joined TriNet as senior vice president of finance. Beckert will be appointed as chief financial officer immediately following…

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. CA, Inc. (CA) currently has a Beta value of 1.04 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at CA, Inc current P/E ratio. CA, Inc. (CA) currently has a PE ratio of 17.80. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at CA, Inc beta and P/E ratio, the EPS cannot be ignored. CA, Inc EPS for the trailing twelve months was 1.80. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. CA, Inc is estimated to release its next earnings report on 3 / 2018 (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

The Analyst Chirp:

CA, Inc. (CA) has received an average target price from analysts of $32.95 amounting to a recommendation rating of Hold. That comes from 17 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 13.19. To give a sense of trend, the same data point on the estimate for next year is currently sitting at 12.68 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 14.00. That shift to 14.00 heading into next quarter.

 

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

Continue Reading

Stocks

Why BioMarin Pharmaceutical Inc. (BMRN) could blow up your portfolio

Published

on

Stock of BioMarin Pharmaceutical Inc. (BMRN) opened at $81.82 and last traded at $81.32 x 200. More than 539,968 shares exchanged hands compared to an average daily volume of 1,351,136 shares. At the current pps, the market capitalization stands at 14.27B.

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. BioMarin Pharmaceutical Inc. (BMRN) currently has a Beta value of 1.42 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at BioMarin Pharmaceutical Inc current P/E ratio. BioMarin Pharmaceutical Inc. (BMRN) currently has a PE ratio of N/A. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at BioMarin Pharmaceutical Inc beta and P/E ratio, the EPS cannot be ignored. BioMarin Pharmaceutical Inc EPS for the trailing twelve months was -1.07. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. BioMarin Pharmaceutical Inc is estimated to release its next earnings report on N/A (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

The Analyst Chirp:

BioMarin Pharmaceutical Inc. (BMRN) has received an average target price from analysts of ${{marketwatch_AverageTargetPrice}} amounting to a recommendation rating of {{marketwatch_AverageRecommendation}}. That comes from {{marketwatch_NumberofRatings}} different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of {{marketwatch_MedianPEonCYEstimate}}. To give a sense of trend, the same data point on the estimate for next year is currently sitting at {{marketwatch_MedianPEonNextFYEstimate}} times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of {{marketwatch_NoofEstimates_this_quarter}}. That shift to {{marketwatch_NoofEstimates_next_quarter}} heading into next quarter.

 

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

Continue Reading

Stocks

Biogen Inc. (BIIB) finding value in an unloved sector

Published

on

Stock of Biogen Inc. (BIIB) opened at $309.69 and last traded at $312.51 x 200. More than 463,536 shares exchanged hands compared to an average daily volume of 1,353,516 shares. At the current pps, the market capitalization stands at 65.71B.

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. Biogen Inc. (BIIB) currently has a Beta value of 1.37 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at Biogen Inc current P/E ratio. Biogen Inc. (BIIB) currently has a PE ratio of 20.39. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at Biogen Inc beta and P/E ratio, the EPS cannot be ignored. Biogen Inc EPS for the trailing twelve months was 15.24. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. Biogen Inc is estimated to release its next earnings report on 12 / 2017 (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

The Analyst Chirp:

Biogen Inc. (BIIB) has received an average target price from analysts of $352.87 amounting to a recommendation rating of Overweight. That comes from 35 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 14.07. To give a sense of trend, the same data point on the estimate for next year is currently sitting at 13.18 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 29.00. That shift to 13.00 heading into next quarter.

 

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

Continue Reading

 


Lithium Stocks

 

Trending