Is Asian Paints Stock still a good buy?

Posted Date: May 17 2021

Asian Paints Ltd stock has cleared a 17-week, 21% deep Cup with Handle Base this week. Currently, the stock is trading around just 4% away from its ideal buy price of INR 2694. The stock is offering investors an opportunity to get on board at the current price.

 

The key trend lines, 10 and 40-week moving averages are at a comfortable position. The current trends of both the averages are upward and the 10-week moving average is trending above the 40-week moving average. The current price of the stock is trading around 8.6% away from the 10-week moving average.

 

In the last twelve months, Asian Paints Ltd. has rallied nearly 78.7% as compared to 61.1% for the Nifty500. It has a Relative Strength Rating of 60. We definitely would like to see improvement in the rating. At this point we are taking a step back and focusing on the RS Line.

 

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last four weeks. The overall long term trend of the line is also trending upward. If Asian Paints Ltd. can maintain this outperformance, it could make sense as a CANSLIM trade.

 

On the earnings front, Asian Paints Ltd. has an excellent EPS Rank of 93, which indicates consistency in earnings. The earnings and sales for the stock have grown by 12% and 5%, respectively over the past three years. Its 3-years earnings stability is 8, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 10% and 8%, respectively. The 5-years earnings stability is 7. The return on equity for the last reported year is 27%.

 

The stock belongs to the industry group of Chemicals-Paints. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 82. The current price of Asian Paints Ltd. is -3% off from its 52-week high price and 89% above its 52-week low price.

 

The stock appears on our idea lists: Trend Template - 5 Months

 
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What do you think? Please email us any questions or comments.

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