New World Resources PLC : Towards lowest level

08/20/2012 | 03:30am Opinion : Bearish under 0 GBp Target price : 188 GBp Stop loss: 290 GBp

LONDON STOCK EXCHANGE Coal

New World Resources PLC is a hard coal and coke producer in Central Europe. The Company produces coking and thermal coal for the steel and energy sectors in Central Europe through its subsidiary.

Thomson Reuters’ analysts have revised downward the earnings per share both for 2012 and 2013. In add, they forecast a fall of net margin by 2014. These indicators are often precursors of a declining profitability and a worsening climate of investor confidence.

Graphically, we can see that the stock is in a bearish trend with decreasing moving averages, which serve as slant resistance. The security is moving towards the next support area at GBp 269 in daily data. If the share breaks down this level, active investors could take a short position towards GBp 188, lowest level recorded in 2008. A stop loss will be placed at GBp 290.

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