Tata power: Lights up As It looks To Break Out From A Consolidation Base pattern!!

June 08 2021

Tata Power Co Stock

Tata Power Co stock is worth watching as the stock is forming a 12-week, 21% deep Consolidation Base. The current price is only 1% away from its ideal buy price of INR 115. Aggressive investors could use any tight area breakout inside the base as an opportunity to initiate a small position. A conservative approach may be to add the stock to your watch list so that you are ready to pounce if it breaks out to the traditional entry point.


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 9.87% away from the 10-week moving average.


In the last twelve months, Tata Power Co has rallied nearly 146.4% as compared to 55.6% for the Nifty500. It has a Relative Strength Rating of 67. We definitely would like to see an 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 Tata Power Co. can maintain a healthy upward move, it could make sense as a CANSLIM trade.


Tata Power Co stock has strong institutional support. The Accumulation/Distribution Rating of 'B+' represents heavy institutional buying over the past 13 weeks. Although the shares held by institutions dropped in the last quarter, the number of institutions holding the stock increased at the same time. This shows increasing interest among the institutions.


On the earnings front, Tata Power Co. has an EPS Rank of 69, which is okay but fails to impress a growth stock investor. The sales for the stock have grown by 2% over the past three years; however, the earnings growth remained muted at -33%. Its 3-years earnings stability is 20, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 12% and 1%, respectively. The 5-years earnings stability is 61. The return on equity for the last reported year is 8%.


The current price of Tata Power Co. is -1% off from its 52-week high price and 200% above its 52-week low price. The stock belongs to the industry group of Utility-Electric Power, which is exhibiting excellent strength in the current market environment. The current industry group rank is 25.

The stock appears on our idealists: Minervini Trend Template.
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