Today’s Technical Analysis report revisits a seasonal trade that didn’t live up to expectations when first mentioned about one month ago. Nabors customarily shows strong seasonal gains from February 23rd to May 9th, the period of seasonal strength for the energy sector in general. The stock fell under weak times since the usual start date of this seasonal play, but the last few days have brought rising energy prices that have favorably influenced the stock to perform.
Before we proceed, a summary of the rest of the stocks moving the market is in order. Of the 1664 stocks analyzed today, 1433 advanced, 222 declined and the last 9 stayed neutral on the day. Gains across the stocks averaged 1.64% on volumes over 8% lower than the day previous. Returns ranged from almost 22% for The South Financial Group (NASDAQ:TSFG) to –5.89% for Compellent Technologies, Inc. (NYSE:CML). The distribution of returns for the remaining equities can be observed in the chart below.
Analysis has revealed that with a buy date of October 10 and a sell date of June 1, investors have benefited from a total return of 1327.15% over the last 10 years.This scenario has shown positive results in 9 of those periods.
Conversely, the best return over the maximum number of positive periods reveals a buy date of October 10 and a sell date of May 8, producing a total return over the same 10-year range of 1244.37% with positive results in 10 of those periods.
The buy and hold return for the past 10 years was 41.5%.
Comments:
Since first mentioning this stock, institutional accumulation continues to take place and the overvalued equity has finally revealed some value that can be taken advantage of.The fundamentals for this stock remain rather "blah", but at least we can see some kind of support.The stock is trading just above its book value of $18.16.The stock came very close to touching this value after bottoming at $18.76 just over a week ago.So now, its time for seasonal influences to kick into gear.Technical’s are providing "buy" signals and the stock is outperforming the already strongly gaining energy sector overall.Targets place this stock back at the $23 level last witnessed at the beginning of March.This represents an 11% appreciation above current levels.Seasonal prospects remain positive between now and May, which could be exceeded by a push into June for a 10% to 15% return over the period.
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Disclosure: Mr. Vialoux does not own securities mentioned in this report.
Disclaimer: Comments and opinions offered in this report at EquityClock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities.
Data offered in this report is believed to be accurate, but is not guaranteed.
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