SThree plc : Good timing to anticipate a continuation of the trend

01/08/2020 | 02:59am EST

long trade on a pullback Target price hit

Entry price : 356GBX | Target : 379GBX | Stop-loss : 345GBX | Cancellation Level : 370GBX | Potential : 6.46%

Shares in SThree plc do not show any sign of a slowdown in the ascending dynamic. Investors could bet on a continuation of the underlying trend. Investors should buy the stock at current prices near GBX 356 in order to target the GBX 379.

Summary

• The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
• In a short-term perspective, the company has interesting fundamentals.

Strengths

• Considering the small differences between the analysts' various estimates, the group's business visibility is good.
• Historically, the company has been releasing figures that are above expectations.
• The company is one of the most undervalued, with an "enterprise value to sales" ratio at 0.33 for the 2019 fiscal year.
• With a P/E ratio at 11.4 for the current year and 10.66 for next year, earnings multiples are highly attractive compared with competitors.
• The company is one of the best yield companies with high dividend expectations.
• Analysts covering this company mostly recommend stock overweighting or purchase.
• Within the weekly time frame the stock shows a bullish technical configuration above the support level at 308.5 GBp

Weaknesses

• The share is close to its long-term resistance in weekly data. Therefore, the potential should be limited. However, a further bullish movement when crossing this resistance will be a positive signal.
• Technically, the stock approaches a strong medium-term resistance at GBp 379.
• The company sustains low margins.
• For the last four months, the sales outlook for the coming years has been revised downwards. No recovery of the group's activities is yet foreseen.

© MarketScreener.com 2020

	Stocks mentioned in the article	Change	Last		1st jan.
	AMP LIMITED	-0.64%	1.555		-0.32%
	AT HOME GROUP INC.	0.73%	24.93		61.25%
	BEST INC.	-6.58%	2.27		11.27%
	BYD COMPANY LIMITED	2.50%	254.6		25.30%
	NEXT PLC	-2.99%	7914		11.69%
	STHREE PLC	0.61%	328		10.07%

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