PAX Global Tech (Ticker: 327) is a HK-based producer of cashless payment hardware similar to Ingenico, while being significantly more undervalued than the latter. long term target for the stock is 10-15 HKD.
Since the huge breakout in Aug the stock followed the exact same pattern 3 times already:
- 2-4 days breakout on higher volume
- backtesting of breakout area
- next leg up along long term trend line
In the next few days, I expect PAX to consolidate at a price level of ~4.7 HKD - in a similar fashion;
Once connected to the long term trend (blue line) I expect a huge leap upwards within 2-5 days and a following consolidation and backtest slightly above previous breakout levels.
The short term target for the 1st week of Nov is in the area around the intraday high in Aug (5.4 HKD), and I'll give it a >50% chance that this will be even exceeded during the run up. So we're looking at a +15-20% gain within 2-3 weeks.
Long term I am bullish on the stock anyway, so every level here is a clear buy. the company sports a PE of ~6 while earning double digit ROICs, having a healthy growth path in emerging markets and started paying increasing dividends and uying back their own shares.
Since the huge breakout in Aug the stock followed the exact same pattern 3 times already:
- 2-4 days breakout on higher volume
- backtesting of breakout area
- next leg up along long term trend line
In the next few days, I expect PAX to consolidate at a price level of ~4.7 HKD - in a similar fashion;
Once connected to the long term trend (blue line) I expect a huge leap upwards within 2-5 days and a following consolidation and backtest slightly above previous breakout levels.
The short term target for the 1st week of Nov is in the area around the intraday high in Aug (5.4 HKD), and I'll give it a >50% chance that this will be even exceeded during the run up. So we're looking at a +15-20% gain within 2-3 weeks.
Long term I am bullish on the stock anyway, so every level here is a clear buy. the company sports a PE of ~6 while earning double digit ROICs, having a healthy growth path in emerging markets and started paying increasing dividends and uying back their own shares.
Comment:
bit bumpier upwards trajectory but stock exactly on long term trend line
Comment:
Big PR "Profit Alert": profit up 40% yoy, exp. EPS ~0.8 HKD. Slap a PE of 8 on it as it had the last 3 months and you get a stock price of 6.40 HKD. Expected to hit within 3 days.