An Italian power stock making new highs
1st December 2021 07:46
by Alistair Strang from Trends and Targets
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Few companies are painting all-time highs in current world conditions, but this one is. Here's what independent analyst Alistair Strang thinks about prospects for this Italian chainsaw manufacturer.
An unhealthy fascination with garden machinery would probably best describes our attitude to gardening. In our weekly trawl for companies in Europe justifying interest, Emak SpA (MTA:EM), a respected and well-known Italian manufacturer of such outdoor toys as chainsaws, small tractors, even tracked vehicles, popped their head above the hedge of future possibilities. Trading internationally, the company claim a presence in 14 countries.
Their share price has just achieved an all-time high, quite a big deal when viewed against the background of the Italian stock market. Closing Tuesday at €2.28, the share price is nibbling at the edge of further considerable strength for the longer term, requiring closure above just €2.33 to force us to regard a new cycle as beginning.
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In fact, even near term trades exceeding €2.37, the high of Tuesday, should give early warning for some useful traffic ahead.
Source: Trends and Targets. Past performance is not a guide to future performance
The immediate situation looks capable of movement above €2.37 looking capable of triggering further growth to €2.55. If bettered, our secondary calculates at €2.79, but perhaps more importantly, places the share in a cycle where a longer term €3.31 becomes very believable.
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For everything to go horribly wrong, the share price requires weakness below €1.9, as this comes with the threat of reversal to an initial €1.6. If broken, we can calculate a probable bottom at €1.19 making itself known eventually.
While there are certainly solid arguments almost demanding a rebound if € 1.19 ever appears, for the present, our inclination is toward a positive outlook, not least because few companies are painting all-time highs in current world conditions.
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea.
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