Renewable energy group’s share price was heavily penalized and is now in an oversold situation near a solid support area.

From a fundamental viewpoint, Renewable energy group is undervalued in terms of enterprise value. Based on the current price, its market capitalization, plus its net debt, represents 0.35x times its revenues. This valuation is just 5.9 and 11.1 times the two next years earnings. Furthermore, EPS estimates have been revised upward in the last few months by analysts.

The stock follows a bullish trend on all time scales. The security fell sharply after running out of steam in the USD 15.5 resistance area. Now, indicators shows an oversold situation and a technical rebound has already occurred on the USD 13.8 support. The 20-day moving average should avoid a reversal and would support the stock to join the USD 15.5 resistance rapidly.

In this case, most active investors could buy the security now to target a return on the USD 15.5 area. A potential breakout of this threshold will open a new bullish strategy. A stop loss will be fixed under the short term support.