EL.En. S.p.A. : The underlying trend is to the upside

12/17/2021 | 03:10am EDT

Nicolas Aleksy

long trade Stop-loss triggered

Entry price : 14.66€ | Target : 17.6€ | Stop-loss : 12.6€ | Potential : 20.05%

The underlying tendency is to the upside for shares in EL.En. S.p.A. and the timing is opportune to get back into the stock. A comeback of the upward dynamic can be anticipated. Investors have an opportunity to buy the stock and target the € 17.6.

Summary

• The company has strong fundamentals. More than 70% of companies have a lower mix of growth, profitability, debt and visibility.

Strengths

• The company's earnings per share (EPS) are expected to grow significantly over the next few years according to the consensus of analysts covering the stock.
• The company is in a robust financial situation considering its net cash and margin position.
• Over the past year, analysts have regularly revised upwards their sales forecast for the company.
• Growth remains a strong point in this company. In their sales forecast, analysts sound optimistic with regard to sales prospects.
• For the past year, analysts covering the stock have been revising their EPS expectations upwards in a significant manner.
• Analysts remain confident with respect to the group's activity and, more often than not, have revised upwards their earnings per share estimates.
• Analysts covering this company mostly recommend stock overweighting or purchase.
• The difference between current prices and the average target price is rather important and implies a significant appreciation potential for the stock.
• The average price target of analysts who are interested in the stock has been strongly revised upwards over the last four months.
• Over the past twelve months, analysts' opinions have been strongly revised upwards.

Weaknesses

• The company appears highly valued given the size of its balance sheet.
• The valuation of the company is particularly high given the cash flows generated by its activity.
• The company is not the most generous with respect to shareholders' compensation.

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