This article is for education purposes only, and not to be taken as advice to buy/sell. Please do your own due diligence before committing to any trade/investment.
The school holidays are here!
Have you gone for your holiday?
I had gone for mine a couple of months back, so I won’t be going anywhere for a vacation anytime soon.
If you’re fully recharged from your holiday, let’s examine the shares of Ametek to understand why this stock should be on your radar.
Brief History of Ametek
Source: ametek.com
Ametek was established in 1930 as a utilities firm, at the beginning of the Great Depression.
In the height of the Great Depression, Ametek defied all odds and turned profitable.
With shrewd business management, Ametek had undergone several mergers and acquisitions, and divestments.
The company had undergone several restructuring, transforming itself into a manufacturer of electronic instruments and electromechanical devices.
Its customers include companies in the aerospace and defense, manufacturing, healthcare, and energy industries.
Business Model and Financials
Source: tradingview.com
Given that Ametek deals with businesses in the aerospace and defense, manufacturing, healthcare, and energy industries, you can reasonably expect the company to enjoy a steady income and profits.
Let’s verify by looking at its total revenue (in blue) and net income (in orange).
Can you tell that the Ametek’s total revenue has been growing steadily with the exception of 2020?
So has its net income (it had grown in 2020)!
Knowing that Ametek is financially strong, let’s turn our attention to its share performance.
You’ll want to determine whether you should buy its shares for a position trade now.
Technical Analysis on Ametek (NYSE: AME)
At a glance, are you able to tell that the share price of Ametek is in a beautiful uptrend?
You can easily infer this from the number of blue (solid and outlined) candles outnumbering those in red (solid and outlined). There’s no need for any technical tools.
I’ve included the 2 main technical indicators that will help you in your decision-making.
They are the green arrow and Trend Impulse Factor.
When you are looking for buying opportunities, the best time to buy is at the start of a new bullish leg. This is where the green arrow comes in.
The green arrow indicates a new bullish leg that you’ll want to jump on and ride the trend.
However, it pays to look at the Trend Impulse Factor indicator too.
When the bar of its Trend Impulse Factor is dark green, it indicates the presence of momentum. Presently, the time to buy Ametek’s shares for a position trade isn’t ripe.
However, you’ll want to keep this on your radar because a position trading opportunity may appear sooner rather than later.
Conclusion
Source: unsplash.com
Ametek survived the Great Depression and emerged stronger through shrewd management.
Its financial health is stable and strong.
Furthermore, there’s a fresh bullish leg. What’s lacking is the confirmation of momentum at the moment (suggested by our proprietary indicators).
Both the arrow and Trend Impulse Factor indicators have been tested and proven. They form the TradersGPS (TGPS) system to help you decipher if a stock is ripe for a position trade. You won’t have to feel in the dark and make wild guesses.
Therefore, the time to buy its shares for a position trade isn’t here yet. There’s a good chance of it appearing soon though!
What are your thoughts?
Share your thoughts with me below!
