Indicators argue for a technical correction after the last bullish movement recorded in past sessions.

Indeed, the stock surged after the company released better than estimates earnings for the Q1 2014 (EPS of 0.05 vs 0.04 expected).

However, fundamentals are still weak and does note justify the current valuation of the firm. Last year, sales were down 5% and earnings negatives (-17.3 million dollars). Further, analysts have recently revised downward their EPS estimates. P/E ratio for the current year is at 35.5x and expected at 23.8x for next year. With a market capitalization/revenue ratio of 2.42x, the valuation of the group is not justified by the fundamental situation.

Graphically, the stock went through a period of rebound in recent sessions towards the USD 11.4 medium-term resistance, corresponding to the 100-day moving average. The share should consolidate near this area. It could act as a stopping point of the upward movement. This scenario suggests a return to the USD 10.3 support area which will be a bearish objective.

Due to the technical configuration and a bad fundamental situation that does not justify the current valuation of the group, investors can open a short position close to the USD 11.4 resistance. The price target is set at USD 10.3 and a stop loss will be placed above USD 11.42.