Home Retail Group' stock is back to a significant support level and may resume its uptrend.
According to Surperformance ratings, the group has strong fundamentals, both in terms of business predictability and valuation. Based on current prices, the company is valued at 0.14 times its sales. In addition, analysts have recently revised upward their earnings estimates and now expect a profit of GBp 6.15 per share for 2014.
Following a bullish wave, the stock now shows a slight decline that led it towards its GBp 132.7 medium-term support. This level use to be a major resistance, and corresponds as well to the gap of 14 March. Thus, this threshold may stop the short term bearish trend, and allow buyers to take the upper hand towards USD 148.1.
The decline observed in the short term offers an interesting entry point for a mid-term investment. Investors will take advantage of the current area to buy Home Retail Group. The objectives will be set at GBp 148.1 and by extension GBp 160.2. The stop loss will be triggered below the GBp 132.7 support.