Wolseley security rebounded upon contact with its support area which represents a strategic entry point.

The world’s largest heating and plumbing distributor to the professional market shows good fundamentals. Surperformance ratings underline its profitability and valuation. The turnover should increase to GBP 13.6 billion in 2015 and GBP 14.5 billion in 2016, with a positive margins' evolution. Moreover, the security shows low P/E ratio which should decrease next year, from 14.8x to 12.9x. Also, EPS might rise up to GBp 246 in the horizon 2016, against GBp 189 for the current year. Furthermore, Morgan Stanley raises its price target to GBp 3700, mentioning an overweight situation, while analysts’ consensus is set at GBp 3630.

Graphically, the area of the GBp 3020 support enabled a rebound of the stock, in order to have a new bullish trend. The long term support in this area confirms its relevance. Technically, above these levels, 4-traders analysts are optimistic and count on a return toward the long and mid-term resistances.

Ideally, investors will take a long position placing a stop-buy order in case of the GBp 3211 short-term resistance break-up. The first goal will be the GBp 3362 level, then a second target toward the long and mid-term GBp 3475 resistance. This strategy should be covered by a stop loss placed around GBp 3160, under the current price, because a bearish movement would invalidate it.