The Mark Minervini Trend Template is a methodical process built to find stocks showing firm technical uptrends, concentrating on particular moving average arrangements, closeness to 52-week peaks, and better relative performance. This process is paired with a high growth momentum filter, which looks for firms displaying quickening earnings and sales expansion, traits frequently seen in market front-runners before they experience major price gains. By merging these technical and fundamental checks, investors can locate securities that are both in solid uptrends and have the operational drive to possibly continue their expansion.
Meeting the Minervini Trend Template
Avadel Pharmaceuticals Plc (NASDAQ:AVDL) shows a notable technical picture that matches the requirements of the Minervini Trend Template. The template's main goal is to verify a stock is in a confirmed and firm stage 2 uptrend, which is important for reducing risk and taking part in a stock's most potent price gain period.
A check of the main technical measures for AVDL shows a firm match:
- Price Above Key Moving Averages: The present price is above the increasing 50-day, 150-day, and 200-day simple moving averages. This arrangement confirms the stock is in a positive trend across short, intermediate, and long-term periods.
- Moving Average Arrangement: The 50-day SMA is above both the 150-day and 200-day SMAs, and the 150-day SMA is also above the 200-day SMA. This ordered positive arrangement is a key feature of the Trend Template, showing continued and quickening buying interest.
- Closeness to 52-Week Highs: The stock is trading within 25% of its 52-week peak, a main Minervini rule that directs attention to strength and leadership instead of weaker performers. Stocks close to their peaks often have the drive to keep rising.
- Firm Relative Strength: With a ChartMill Relative Strength rating of 89.24, AVDL is doing better than almost 90% of all stocks in the market. High relative strength is a required feature for Minervini, as it finds market front-runners that usually do better during rising markets.
High Growth Momentum Fundamentals
Besides a clean chart, the Minervini method stresses the value of firm fundamental drivers. AVDL displays several features that are highly valued by growth investors, indicating the company is in a period of quick business growth.
The fundamental information points to a firm undergoing a strong operational recovery and quickening:
- Fast Earnings Growth: The company has moved to profitability, with EPS (TTM) showing 97.37% growth year-over-year. More notably, recent quarterly EPS growth has been very high, with the last quarter increasing 171.43% compared to the same quarter a year before.
- Quick Revenue Growth: Top-line growth is equally firm. Revenue (TTM) has grown over 132% year-over-year. The most recent quarter had sales rise by 64.15%, following on even higher growth in earlier quarters.
- Positive Analyst Changes: Analysts are becoming more positive about the company's future. The average estimate for next year's revenue has been increased by 4.74% over the last three months, showing growing belief in the company's growth path.
- Regular Earnings Beats: The company has exceeded EPS estimates in three of the last four quarters, with an average beat of almost 79%. This regular overachievement often draws institutional attention and can be a reason for further price gains.
These fundamental numbers are important because, as Minervini states, "big earnings attract big attention." A company showing such quick growth in both profits and sales is likely to get the attention of large institutional investors, whose purchasing can support a continued uptrend.
Technical Health and Setup Summary
The ChartMill Technical Report gives a numerical evaluation of AVDL's technical condition, giving it a high rating of 9 out of 10. This score shows its firm performance across multiple time periods and its front-runner position within the pharmaceuticals industry. The report also mentions a solid setup rating of 8, showing the stock is currently pausing in a positive formation after its recent rise, which can offer a possible entry point for investors. Main technical points include a clear support area and a resistance level just above the present price, giving a clear structure for risk management.
For a detailed look at the support and resistance levels, and a particular trade setup idea, you can check the full technical analysis report for AVDL.
Discovering Similar Opportunities
For investors looking for other firms that fit this potent mix of firm technical trends and high-growth fundamentals, the filtering method that found AVDL can be a useful instrument. This process methodically scans the market for stocks that satisfy the strict Minervini Trend Template while also showing firm growth momentum.
You can find more possible choices that meet these requirements by using this predefined screen.
Disclaimer: This is not investment advice. The content is intended to be used for informational and educational purposes only. It is crucial to perform your own due diligence and consider your individual financial situation before making any investment decisions. Please read our full disclaimer and terms of use to understand our obligations.
