Sepura : A downturn could form
By Etienne Veber
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
GBX 190 | GBX 0 | GBX 197 | +100% |
From a fundamental viewpoint the company appear overvalued. P/E Ratio for the current year is at 41.1x and expected at 17.25x for next year. With a valuation ratio of 2.47x, the group appears overvalued compared to its business activity.
Graphically, the share is in the middle of a technical rebound that allowed it to reach the GBp 191 mid-term resistance. This area could trigger a sell signal for investors in a scenario of profit-taking.
Due to the technical patterns and poor quality fundamentals that do not justify the current valuation of the group, investors can open a short trade close to the GBp 191 resistance. The price target being set at GBp 173, a stop-loss order could be placed above GBp 191 for limiting further risks.