Astec Industries Inc (NASDAQ:ASTE) has been identified by a specific screen built to find stocks matching two different but connected investment styles. The screen first uses the strict technical rules of Mark Minervini’s Trend Template, a system centered on finding stocks in strong, confirmed uptrends. It then adds a filter for a High Growth Momentum (HGM) rating, looking for firms with improving fundamental results. This dual method tries to locate securities where good price movement is supported by better business results, a pairing frequently desired by investors focused on growth.
Fitting the Minervini Trend Template
For a trader using Mark Minervini’s strict system, a stock must first satisfy a set of technical conditions to verify it is in a sound Stage 2 advance. The Trend Template is made to exclude weak or declining stocks, concentrating only on those displaying clear institutional buying and trend health. An examination of Astec Industries shows it fits many of these important technical conditions.
- Trend Condition: The stock is priced above its increasing 150-day ($43.36) and 200-day ($41.20) simple moving averages (SMAs). This meets the template's need for the price to be above these longer-term averages, which are also moving up, showing a positive long-term base.
- Momentum Arrangement: The nearer-term 50-day SMA ($45.85) is above both the 150-day and 200-day SMAs. This order of averages, with shorter periods above longer ones, is a standard sign of a continuing uptrend and a central idea of the Minervini system.
- Nearness to Highs: With a present price of $46.36, ASTE is trading more than 30% above its 52-week low of $29.65, showing notable recovery and force. It is also less than 25% from its 52-week high of $50.83, meaning it is joining the market's rise and not falling behind.
- Relative Performance: The stock has a ChartMill Relative Strength (CRS) rating of 74.7, indicating it has done better than almost 75% of the market over the previous year. Minervini stresses that real market leaders show high relative strength, as it points to demand for that specific security.
Although the stock shows a neutral near-term trend in the latest period, its fit with the wider Trend Template conditions implies the basic longer-term trend arrangement is still in place. This technical base is the first essential filter for Minervini-system investors, making sure they only look at stocks that are already in a good position.
Fundamental Data for High Growth Momentum
The next part of the screening process checks if the technical force is matched by fundamental improvement. The High Growth Momentum rating searches for signs of better earnings, sales, and profit. Astec Industries makes a strong argument here, especially in its latest reporting periods.
- Earnings Improvement: The firm has reported a sequence of large year-over-year earnings per share (EPS) beats. The latest quarter had EPS increase by 51.6%, after a 44.3% rise the quarter before and a notable 158.8% jump two quarters ago. This sequence of solid, consecutive growth is a main sign of positive movement.
- Steady Earnings Surprises: Possibly more significant is the regularity of these beats. ASTE has exceeded analyst EPS estimates in all of the past four quarters, with an average beat above 56%. This repeated better-than-expected performance indicates management is doing better than the market predicted, a usual feature in developing growth situations.
- Strong Sales Growth: Recent revenue results also back the growth story. Sales increased by 20.1% year-over-year in the last quarter, showing top-line growth is adding to the bottom-line gains.
- Cash Flow Production: Over the past twelve months, the firm’s free cash flow per share has increased by a notable 161%, pointing to better operational effectiveness and financial condition.
For growth investors, these measures are important. They go past a simple look at valuation and search for proof of positive change, improving growth, widening margins, and steady outperformance. This fundamental movement can be the driver that maintains a technical uptrend, drawing more institutional attention.
Technical Condition and Formation Evaluation
Based on ChartMill’s own analysis, ASTE currently has a Technical Rating of 5 out of 10, meaning an ordinary or neutral technical condition score. The note says the stock has been a comparatively strong performer against the wider market and its sector over the past year. However, the most recent price movement has displayed some softness, resulting in the neutral short and long-term trend labels.
Significantly, the analysis gives a low Setup Quality rating of 2. This implies that, while the stock may match the wider trend conditions, it is not currently presenting a high-probability, low-risk entry chance. The note says that "price movement has been a little bit too volatile to find a nice entry and exit point" and suggests that it "is probably a good idea to wait for a consolidation first." For a strict trader, this highlights a main rule: finding a qualifying stock is only the beginning; entering on a clear formation is key for controlling risk.
A complete summary of the support and resistance points, with full trend analysis, is found in the detailed technical report for ASTE.
A Subject for More Study
Astec Industries shows a notable situation where a firm long-term trend arrangement, as described by the Minervini template, aligns with a clear recent improvement in fundamental performance. This pairing makes it a stock deserving of a place on a watchlist for both trend-based and growth-focused investors. The important following action for a tactical trader would be to watch the price movement for the formation of a constructive consolidation shape, like Minervini’s Volatility Contraction Pattern (VCP), which would give a specific, lower-risk entry point in line with the existing trend.
Locate Comparable Possibilities
Astec Industries was found using a systematic screen that joins trend and growth filters. Investors searching for other stocks that fit similar conditions of healthy technical trends and high growth movement can inspect the screening system directly. You can view and adjust this "High Growth Momentum + Trend Template" screen yourself here.
Disclaimer: This article is for informational and educational purposes only. It is not intended as investment advice, nor does it constitute a recommendation to buy, sell, or hold any security. The analysis is based on data provided and screening methodologies described, which have inherent limitations. Investors should conduct their own thorough research and consider their individual financial situation and risk tolerance before making any investment decisions. Please read our full disclaimer here.
