I can’t say that this graph is making one feel warm and fuzzy, especially if you’re an investor. For a moment Remgro broke 3-year support line (bottom of the falling wedge), just to bounce back and close at the danger-zone. We can clearly see that the trend is still very much against the share price, with very negative momentum. We will further note that Remgro’s share price has been underperforming the FTSE/JSE All Share pretty much most of the time over this 3-year period.
Short-term traders that’s been long, should monitor the next few days closely as I’m sure that a few stop-losses might be triggered should we see further weakness.
I’m however going out on limp in saying that I think it might be good time to nibble. We recently covered the company via one of our reports and I must say that it’s getting really interesting on a valuation basis. It’s trading at one of its highest discount to intrinsic value, since 2011. Both the Forward PE (Source: Thomson Reuters) and Price/Books are at 5-year lows and the Dividend Yield at a 5-year high. You are more than welcome to download the full report for free here: http://oldoak.co.za/wp/index.php/2019/09/27/get-to-know-your-jse-companies-remgro-ltd-jse-rem-3/
Should we see a recovery from current oversold levels (according to its 14-day RSI), levels to monitor would be firstly the 50-day Moving Average (R172.89) followed by the top of the falling wedge formation at R183. A break and close above these levels would be seen as (technically) very bullish and could then possibly only see resistance at the 200-day moving average (R188.58). My personal medium-term price target technically is R191 and longer-term R200. Note that the longer-term target corresponds with our Fundamental Price Target of R208, as mentioned in our report above.
Short-term traders that’s been long, should monitor the next few days closely as I’m sure that a few stop-losses might be triggered should we see further weakness.
I’m however going out on limp in saying that I think it might be good time to nibble. We recently covered the company via one of our reports and I must say that it’s getting really interesting on a valuation basis. It’s trading at one of its highest discount to intrinsic value, since 2011. Both the Forward PE (Source: Thomson Reuters) and Price/Books are at 5-year lows and the Dividend Yield at a 5-year high. You are more than welcome to download the full report for free here: http://oldoak.co.za/wp/index.php/2019/09/27/get-to-know-your-jse-companies-remgro-ltd-jse-rem-3/
Should we see a recovery from current oversold levels (according to its 14-day RSI), levels to monitor would be firstly the 50-day Moving Average (R172.89) followed by the top of the falling wedge formation at R183. A break and close above these levels would be seen as (technically) very bullish and could then possibly only see resistance at the 200-day moving average (R188.58). My personal medium-term price target technically is R191 and longer-term R200. Note that the longer-term target corresponds with our Fundamental Price Target of R208, as mentioned in our report above.
Trade closed: target reached