Bodycote plc : The resistance as main obstacle
By Anas Boumedian
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
GBX 715.5 | GBX 0 | GBX 748 | +100% |
The valuation of the company is not attractive compared to its peers, the EV/Revenue ratio is expected at 2.11x for 2015. Also, the security have reached the average target price fixed by analysts, which should lead to some profit taking.
After a substantial upturn, the stock now approaches the mid-term major resistance at GBp 726, level that could inverse the tendency. This threshold is likely to lead to a consolidation phase.
The graphical configuration argues to establish a short position at the current price. The first objective will be fixed near the GBp 675.5 short term support. This strategy should be protected by a stop loss above GBp 726.