Waddell & Reed Financial, provides investment advisory, product underwriting, distribution and administrative service, is experiencing a downward trend (-30% ytd) that could push it toward USD 33.7, corresponding to a mid-term support.

From a fundamental viewpoint, the group is in a bad financial situation according to Surperformance ratings. The financial situation of the company is worrying with an important debt level. Analysts have recently downgraded their forecasts for earnings per share. This indicator is often a precursor of a declining profitability and a worsening climate of investors' confidence. In addition, sales estimates for 2015 is in decrease at USD 1.5 billion (-5%).

Technically, the share is in a downward trend. The moving averages are decreasing and are still above prices, thereby stopping any rebounds. The security is going toward the USD 33.8 support, a breakout of this level will be a good entry point for a downward acceleration.

That’s why, investors could open a short position in Waddell & Reed Financial below USD 33.7 to target USD 30 (historical threshold). They will also place a stop loss above at USD 35.1 since the trade is opened.