Atour Lifestyle Holdings-ADR (NASDAQ:ATAT) Shows Strong CAN SLIM Investment Traits

The CAN SLIM investment methodology, 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. The method looks for companies displaying solid fundamental numbers along with technical health shown in price action and institutional activity.

Earnings and Sales Momentum

Atour Lifestyle Holdings-ADR (NASDAQ:ATAT) displays the important earnings and sales growth that CAN SLIM investors look for. The company's latest quarterly report shows notable speed:

, Quarterly EPS growth of 28.4% year-over-year , Quarterly revenue growth of 37.4% year-over-year , Three-year EPS growth rate of 110.0%

These numbers easily meet the CAN SLIM minimums of 20-25% for quarterly growth and 25% for yearly rises, showing the company has the earnings speed that frequently comes before notable price gains. The quickening growth trend matches O'Neil's focus on companies with improving business fundamentals.

Profitability and Financial Health

The company's profitability numbers show a fundamentally healthy business operation. With a return on equity of 41.9%, Atour greatly exceeds the CAN SLIM minimum of 10% ROE, putting it in the highest group of its industry competitors. The company's debt-to-equity ratio of 0.02 shows careful financial management, far under the system's highest allowed level of 2.0. This pairing of high profitability and very low debt offers financial room while lowering risk, traits important to growth investors looking for companies with lasting competitive edges.

Market Leadership and Institutional Support

Technical study shows Atour holds a relative strength rating of 76.4, meaning it is performing better than about three-quarters of all market stocks. This market leadership role is key to the CAN SLIM philosophy, which prefers stocks showing relative strength during market rises. Institutional ownership is at 69.9%, under the 85% level that could mean too much ownership. This indicates potential for more institutional buying, which might create further upward pressure as more institutions learn about the company's growth narrative.

Growth Path and Industry Standing

As a lifestyle hotel brand operator in China, Atour is the kind of new company that CAN SLIM targets, those introducing fresh ideas to developing markets. With 834 hotels in 151 Chinese cities and special theme-based services, the company has built a unique market place. The fundamental study report gives Atour a total rating of 8/10, pointing out very good profitability, healthy financials, and notable growth numbers. While the technical rating of 4/10 shows a recent pause, the longer-term direction is still upward, and the stock price is in the higher part of its 52-week range.

Investment Considerations

The complete technical analysis shows the stock is currently checking support levels after a large rise, while the fundamental analysis reveals a company with healthy finances and speeding growth. For CAN SLIM investors, the mix of strong earnings speed, high profitability, fair value, and market leadership traits makes Atour worth watching, especially during times of market health.

Investors wanting to find other companies fitting CAN SLIM standards can look at our pre-set screen for more possible ideas.

,Disclaimer: This article is for informational purposes only and does not constitute investment advice. The author has no position in ATAT. Investors should conduct their own research and consider their financial situation, risk tolerance, and investment objectives before making any investment decisions. Past performance does not guarantee future results.,