Globe Specialty Metals security is likely to get appreciated, taking advantage of a potential technical rebound.

Fundamentally, the global producer of silicon metal reported strong full year fiscal results. Also, Surperformance ratings underline its substantial growth and strong profitability. Sales are expected to increase, as well as the margins. Moreover, the P/E ratio estimated is lower than the current one (12.4x against 16.8x), which would lead to a rise of earnings per share. Moreover, the higher estimated yield might incite investors to buy the stock. Furthermore, the analysts’ consensus regarding the average target price is at USD 22.2, which represents an important potential gain.

From a technical point of view, after several weeks of horizontal fluctuations within the mid-term range USD 16.4 / USD 18.6, the stock is coming back close to the lower limit of the range. Moving averages are flat and technical indicators illustrate the oversold situation. The USD 16.4 support area may cause a positive reaction for the coming trading sessions and allow a technical rebound towards the USD 18.6 mid-term resistance. The long term target price is USD 18.6.

Therefore, the proximity of the USD 16.4 support is an opportunity to take a long position in Globe Specialty Metals. The first goal is a return in the USD 18.6 resistance area, which would represent a potential of 12.2%. In fact, the security has to cross this area in order to re-establish a bullish trend in the mid-term. A stop loss order can be placed under the support currently tested (USD 15.90).