Metro Inc. : Annual highs in line of sight
By Camille Chretien
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
CA$68.85 | CA$0 | CA$67.3 | -100% |
The stock is still undervalued with a P/E ratio estimated at 10.7x for 2013 (vs sector : 27.8x). Further, the group is in a healthy financial situation with a leverage ratio of only 1.05x in 2012 (vs sector : 1.6x).
Technically, the stock is moving in a bullish trend, fully supported by the 100-day moving average and a bullish trend line. The recent comeback on the latter argue in favor of a rebound toward USD 75. However, the technical recovery would be confirmed only in case of breakout of the 100-day moving average.
Thus, a long position can be opened on crossing the moving average, confirmed in daily closing price. The main objective is USD 75. A stop loss must be placed below the USD 68.7 support.