Having touched multi year highs in mid-April, Grifol shares have performed poorly since, exacerbated by recent Antitrust news-flow and underwhelming Q1 numbers. The stock is +9% YTD in absolute terms yet has underperformed the broader sector by -10% over the same period. Strong technicals are now firing and further screening of the stock in OTAS highlights various factors that could suggest the shares may be reaching an area of support.
- Spread vs sector back at lows which have historically acted as a positive inflection point
- Technically, one of the most oversold stocks in the STOXX600 on an RSI measure. 3 back-tested Buy signals have fired in the last week, the most reliable firing overnight (Fast Stochastic, 72% win rate, Ave. 3.75% return)
N.B The RSI Buy signal is also close to firing. Keep an eye on todays closing price !
- Unusually High volume in the shares on Friday. The Microstructure(Return & Volume charts) shows late aggressive buyers entering the name and closing the underperformance with its basket. Volume is extremely high again today…..
- Sector relative P/E valuation beginning to look cheap again. Similar previous lows have acted as a positive re-rating catalyst.
- Short Interest has seen a marginal decrease in the last week.
- Although sub-market, Grifols current sector relative 12m fwd yield is high compared to the last 2 years.
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