stock has broken out of a 11-week, 15% deep Consolidation
Base 3-weeks ago. However, the stock is still worth watching as the current price is only -1% away from the ideal buy price of INR 1349.
The stock closed in red for the week, but on a lower volume. It was down -1.6% on a -71% lower volume than the 10-week average. You want to see a strong close on heavy volume before initiating a position. That signals institutional buying. But do not conclude anything just based on this week’s action. A prudent approach would be to watch the price volume momentum in the coming trading sessions.
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 4.7% away from the 10-week moving average.
In the last twelve months, Rossari Biotech has rallied nearly 72.7% as compared to 41.8% for the Nifty500. It has a Relative Strength Rating
of 54. 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 RS Line remains in a downtrend for the last four weeks. However, this is not unusual for a leading stock as the stock sets up base for its next leg up or at the very beginning of a new trend. At this point, the overall long term trend of the line is upward. If Rossari Biotech can maintain a healthy upward move, it could make sense as a CANSLIM
Rossari Biotech stock has strong institutional support. The Accumulation/Distribution Rating
of 'A-' represents heavy institutional buying over the past 13 weeks. Although the number of institutions holding the stock dropped in the last quarter, the number of shares held by the institutions increased at the same time.
On the earnings front, Rossari Biotech
has a respectable EPS Rank of 79, which is okay but needs improvement. The earnings and sales for the stock have grown by 6% and 25%, respectively over the past three years. Its 3-years earnings stability is 34, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 6% and 31%, respectively. The 5-years earnings stability is 31. The return on equity for the last reported year is 23%.
The stock belongs to the industry group of Diversified Operations. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 93. The current price of Rossari Biotech is -8% off from its 52-week high price and 86% above its 52-week low price.
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