Eagle Rock Energy Partners, L.P. : Bearish trend will come
By Oscar Salza
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
US$9.14 | US$0 | US$9.4 | +100% |
From a fundamental viewpoint, the group is in a bad financial situation. The
financial situation of the company is worrying with an important debt level. Leverage is at 4x for the current year. The share is highly valued; in fact is trading 73 times its earnings estimates.
From a technical viewpoint, prices are in a downward trend. Moving averages are trending down and put pressure on the stock, which confirms this downward momentum. Taking into account fundamental and technical elements, investors can initiate a short position with a price target at USD 8.3. A return towards USD 9.2, the short-term resistance area, will invalidate the bearish strategy, which justifies a stop loss.