CANSLIM Stock: WAB – Westinghouse Airbrake Technologies

This is another CANSLIM stock that I’ve been monitoring since Dec, 2014. It just broke out of a “double-bottom” pattern, so I’ve gone long.

I’ve included the CANSLIM criteria below. Note that this stock meets the criteria on almost all counts.

Criteria Target Actual
YoY Net Income Growth Rate 20% 22%
YoY Sales Growth Rate 25% 26%
EPS Growing past 3 years? Yes Yes
EPS Estimate Higher than last year? Yes Yes
3yr EPS Growth Rate 25% 33%
Return on Equity (5-year average) 17% 19%
Within 10% of High Yes Yes
New Product, Management, etc? Yes Several acquisitions (Aug/Sept), and again in Feb, 2015
12-month relative strength percentile 80% 61%

Let’s take a look at the chart, which shows a breakout of a decent double-bottom.


Note that price broke above point “b” on Friday, accompanied by high volume (80% higher than average). This indicates informed demand.

Strategy: Long @ $89.71 (just above point “b”) with a target of 20-25% gain (~$108). Stop loss is at –8% loss, or $82.60.

1 comment:

pranjali upadhyay said...

This is really quite informative blog such qualitative info I have never seen anywhere.
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