The method used to find possible investment choices joins a strict technical structure with attention to fundamental growth momentum. Its central element is Mark Minervini's Trend Template, a step-by-step method made to sort for stocks showing solid, confirmed uptrends. This template makes certain that choices are not just seeing temporary rebounds but are in verified Stage 2 advances, priced above important moving averages with favorable order and showing better relative performance. To add to this technical condition, the filter includes a High Growth Momentum (HGM) rating, which judges a company's earnings and sales growth path, speed of increase, and profit. The meeting point of these two filters tries to find companies that are both technically set for continued movement and fundamentally driven by strong, speeding business results.
ENLIGHT RENEWABLE ENERGY LTD (NASDAQ:ENLT) comes forward as a notable choice from this joined filtering activity. The Israeli developer and manager of wind and solar energy projects in Israel and Europe seems to match the two requirements of technical condition and fundamental growth.
Checking the Trend Template Match
A main idea of the Minervini plan is to put money in the direction of the current trend, staying away from the problems of trying to buy a declining stock. The Trend Template gives a clear set of points to confirm this. A look at ENLT's present technical position shows a solid match with these points:
- Moving Average Order: The stock's price is trading notably above its increasing 50-day ($63.84), 150-day ($44.42), and 200-day ($39.14) simple moving averages (SMAs). Importantly, the 50-day SMA is above the 150-day SMA, which is then above the 200-day SMA. This ordered positive arrangement across time periods is a standard sign of a solid, sound uptrend and shows continued buying interest.
- Nearness to Highs: ENLT's present price is within 5.5% of its 52-week high of $81.28, easily fitting the "within 25% of the 52-week high" rule. This attention to condition, instead of low price, is key to the plan, as stocks near highs frequently have the momentum to keep rising. At the same time, the price is about 448% above its 52-week low, greatly passing the 30% mark and highlighting the strong uptrend already present.
- Better Relative Performance: With a ChartMill Relative Strength (CRS) score of 99.18, ENLT is doing better than almost every other stock in the market over the last year. Minervini states that market leaders, the stocks most probable to give large returns, almost always show high relative strength scores, commonly above 70 and preferably in the 80s or 90s.
This combination of elements indicates ENLT is in a definite Stage 2 advance, the exact stage the Trend Template is made to find for possible investment.
Judging High Growth Momentum
While the Trend Template deals with the "when," the High Growth Momentum rating tries to answer the "why" by judging the fundamental cause behind the price action. For a growth-centered plan, outstanding and speeding financial results is essential. ENLT's recent reports show several good signs:
- Very Strong Earnings Growth: The company's trailing twelve-month (TTM) EPS has increased by about 95% year-over-year. More lately, earnings growth has shown notable speeding up, with the last reported quarter jumping 150% compared to the same quarter a year before.
- Solid Revenue Increase: Top-line growth stays strong, with TTM revenue up 46% year-over-year. Quarterly sales growth has been steadily solid, recording 33%, 51%, and 59% in the last three straight quarters compared to their year-ago periods.
- Profit Gain: After a time of change, the most recent quarterly profit margin was a solid 9.36%. More significantly, the full-year profit margin for the last reported period was 22.69%, a major gain from 11.09% the year before, hinting at a rise in operational effectiveness along with fast growth.
This design of solid sales growth, quickly speeding earnings, and growing margins creates the fundamental "cause" that Minervini's SEPA (Specific Entry Point Analysis) method looks for. It gives a fundamental reason for the stock's technical condition, suggesting the uptrend could be backed by getting better business fundamentals instead of only speculation.
Technical Condition Summary
A check of the given technical analysis report gives a combined view of ENLT's market position. The stock gets a complete Technical Rating of 10/10, showing very good condition across short-term and long-term time periods. The report states both trends are positive, the stock is a major outperformer in its industry (Independent Power and Renewable Electricity Producers), and it is ahead of the wider market by trading near its highs while the S&P 500 is not. The Setup Rating is a fair 6, showing that while the stock is stretched in the immediate short term, it has been moving in a range over the last month, letting some movement settle. Important support is found in the $71.95 - $73.74 area, with resistance near $77.31 - $78.36.
For a full look at the technical levels, support, resistance, and automatic trade setup, you can check the complete ChartMill Technical Analysis Report for ENLT.
Locating Comparable Chances
ENLT was found using a specific filter that combines Minervini's trend rules with growth momentum filters. People looking to study similar choices that fit this mix of technical and fundamental points can examine the filtering method directly.
→ View the "High Growth Momentum + Trend Template" Screen for More Results
Disclaimer: This article is for information and learning only. It is not advice to buy or sell any security. The analysis is based on given data and filtering methods, which have built-in limits. People should do their own complete research, think about their personal money situation and risk comfort, and talk with a qualified financial advisor before making any investment choices. Past results are not a guide for future results.