L'ORÉAL

OR
Real-time Quote. Real-time  - 01/27 09:16:11 am
296.7EUR -1.69%

L'Oréal : One could take advantage of the market's hesitation

The editorial team
 

Strategy published on : 01/14/2021 | 02:43

long trade
Live

Entry price : 300.8€
Target : 320€
Stop-loss : 288€
Potential : 6.38%

Shares in L'Oréal are retreating towards the lower bound of a horizontal trading range. Investors could use the proximity of this support area to initiate new long positions.
Investors have an opportunity to buy the stock and target the € 320.

Strengths

● The company returns high margins, thereby supporting business profitability.

● Thanks to a sound financial situation, the firm has significant leeway for investment.

● Predictions on business development from analysts polled by Standard & Poor's are tight. This results from either a good visibility into core activities or accurate earnings releases.

● The tendency within the weekly time frame is positive above the technical support level at 263.4 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.

● Financial statements have repeatedly disappointed market stakeholders. Most often, they were below expectations.

● With an enterprise value anticipated at 5.95 times the sales for the current fiscal year, the company turns out to be overvalued.

● The company benefits from high valuations in earnings multiples.

● For the last twelve months, sales expectations have been significantly downgraded, which means that less important sales volumes are expected for the current fiscal year over the previous period.

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