Deutsche Wohnen
DWNI
Delayed Frankfurt - 09/20 05:35:48 pm
42.18EUR
+0.52%

Anticipation of a technical correction

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Ulrich Ebensperger
Financial Analyst

Strategy published on : 04/13/2018 | 08:48

short sell
Stop-loss triggered

Entry price : 37.72€
Target : 35€
Stop-loss : 38.36€
Potential : 7.21%

The recently observed upswing has shown some signs of exhaustion, which makes for good timing to employ a short strategy with a short term perspective.
Investors should open a short trade and target the € 35.

Strengths

● The group's activity appears highly profitable thanks to its outperforming net margins.

● Its low valuation, with P/E ratio at 9.03 and 10.6 for the ongoing fiscal year and 2019 respectively, makes the stock pretty attractive with regard to earnings multiples.

● Over the last 4 months, analysts have significantly revised upwards the company's estimated sales.

● Over the last twelve months, the sales forecast has been frequently revised upwards.

● For the last week, the earnings per share forecast has been revised upwards. According to recent estimates, analysts give a positive overview of the stock

● For the last 4 months, the company has been enjoying highly positive EPS revisions, which were frequently and significantly raised.

● For the past year, analysts covering the stock have been revising their EPS expectations upwards in a significant manner.

● 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 35.19 EUR


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.

● The stock is currently in contact with a medium-term resistance that must be gotten rid of so as to resume the upward trend.

● The company is in a hindered financial situation with significant debt and rather low EBITDA levels.

● Prospects from analysts covering the stock are not consistent. Such dispersed sales estimates confirm the poor visibility into the group's activity.

● The company's "enterprise value to sales" ratio is among the highest in the world.

Zonebourse.com 2018
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