ASA Gold and Precious Metals (NYSE:ASA) Shows Strong CAN SLIM Investment Profile

The CAN SLIM investment strategy, created by William O'Neil, joins fundamental and technical analysis to find high-growth market leaders. This organized method assesses companies using seven main criteria represented by the letters CAN SLIM, concentrating on earnings speed, yearly growth patterns, new products or services, supply and demand forces, market leadership, institutional backing, and the general market direction. Investors applying this system look for stocks with good quarterly and yearly earnings growth while also displaying technical health through relative price performance.

Recent Performance and Growth Measures

ASA Gold and Precious Metals (NYSE:ASA) shows very good quarterly growth that fits with the CAN SLIM system's focus on speeding up earnings and sales. The company's latest quarterly results display notable momentum across important fundamental signs:

• Quarterly EPS growth of 209.5% compared to the same quarter last year
• Quarterly revenue growth of 173.8% year-over-year
• Three-year EPS compound annual growth rate of 49.7%

These growth numbers are much higher than the CAN SLIM minimum requirements of 20-25% for quarterly earnings growth and 25% for yearly EPS growth. The major speed-up in both earnings and revenue indicates the company is having strong operational momentum, a key trait wanted by CAN SLIM investors who favor companies displaying growing growth rates instead of slowing trends.

Financial Condition and Profitability

The CAN SLIM system focuses on companies with good financial bases and efficient operations. ASA shows several traits that meet these needs:

• Return on Equity of 54.8%, much higher than the 10% minimum level
• No debt, leading to a debt-to-equity ratio of 0
• Current ratio of 12.9, showing high liquidity
• Positive earnings and operating cash flow in the last year

The outstanding ROE number is especially notable as it shows efficient use of shareholder money, while the lack of debt gives financial room and lowers risk. These measures fit with the CAN SLIM focus on companies with good fundamental health and profitable operations.

Technical Health and Market Standing

Technical analysis is an important part of the CAN SLIM system, with focus on relative strength and chart formations. ASA displays good technical traits:

• Relative strength rating of 94.7, showing it does better than almost 95% of all stocks
• 12-month performance of 109.3%
• Trading in the higher part of its 52-week range
• Positive long-term trend with several support levels seen

The high relative strength is especially important within the CAN SLIM structure, as O'Neil stressed investing in market leaders instead of followers. Stocks displaying good relative strength during market upward moves often represent companies with institutional backing and positive momentum.

Institutional Backing and Supply Factors

CAN SLIM investors watch institutional ownership levels, looking for companies with increasing institutional interest but staying away from those where institutions already hold most available shares. ASA presents a good profile here:

• Institutional ownership of 73%, under the 85% level
• Moderate float that has not become too diluted
• Average daily volume over 100,000 shares, giving enough liquidity

The institutional ownership level falls within the ideal range identified by O'Neil, high enough to show professional investor interest but with space for more institutional buying.

Full Analysis View

According to the technical analysis report, ASA gets a top rating of 10/10, reflecting good performance across several time periods. The stock shows steady upward momentum with clear support levels between $45.37 and $45.95. The fundamental analysis report gives a more average rating of 3/10, noting outstanding recent growth but questions about long-term steadiness and valuation. This difference between technical and basic assessments is not unusual for CAN SLIM candidates, as the method often favors earnings momentum and price action over standard valuation measures.

Market Situation and Investment Points

The present market condition, with the S&P 500 showing positive long-term and short-term trends, gives a good setting for CAN SLIM investing. ASA's good relative performance during this time suggests it is taking part in the market rise while doing better than many similar companies. The company's focus on precious metals exploration and mining fits with the "New" part of CAN SLIM, representing exposure to commodities that often do well during specific economic periods.

For investors wanting to look at more CAN SLIM candidates, the screening method that found ASA can be used to find other possible opportunities meeting similar growth and technical requirements.

Disclaimer: This analysis is for information only and is not investment advice, a suggestion, or a support of any security. Investors should do their own research and talk to financial advisors before making investment choices. Past results do not ensure future outcomes.