For investors looking to join solid technical trends with solid fundamental growth, the method created by Mark Minervini offers a strong framework. This process, often called the SEPA (Specific Entry Point Analysis) strategy, methodically finds stocks showing strong uptrends, backed by quickening earnings and revenue growth. The aim is to locate market leaders early in their large price gains. A main screening instrument in this process is the Minervini Trend Template, which uses firm technical filters to confirm a stock is in a verified, sound uptrend. When this technical force is joined with a high fundamental growth rating, such as ChartMill’s High Growth Momentum (HGM) score, it can point to possible choices that fit a high-growth, momentum-focused investment view.
Technical Force: Meeting the Minervini Trend Template
A central belief of the Minervini strategy is to trade in the direction of the existing trend, concentrating on stocks already in a Stage 2 advance. The Trend Template gives a checklist to filter for such force. A look at Evercore Inc. (NYSE:EVR) shows it currently meets these important technical conditions:
- Price Above Key Moving Averages: The stock trades well above its rising 50-day ($336.01), 150-day ($317.59), and 200-day ($291.40) simple moving averages (SMAs). This order confirms the stock is in a continued uptrend across several timeframes.
- Moving Average Order: The 50-day SMA is above both the 150-day and 200-day SMAs, and the 150-day SMA is above the 200-day SMA. This "stacked" order is a clear sign of positive momentum and institutional buying.
- Nearness to Highs: With a current price of $366.50, EVR is trading within 6% of its 52-week high of $388.71 and is about 147% above its 52-week low. Minervini states that real market leaders make new highs, not new lows.
- Strong Relative Strength: The stock has a ChartMill Relative Strength (CRS) ranking of 84.61, meaning it is doing better than most of the market. High relative strength is a sign of leadership, showing the stock is wanted no matter the wider market moves.
This technical view suggests EVR is in a clear uptrend with solid underlying momentum, a main need before any fundamental study is thought about in the Minervini process.
Fundamental Force: The Case for High Growth
While a strong chart is needed, Minervini notes that the largest stock winners are nearly always backed by outstanding fundamental performance. This is where the High Growth Momentum rating becomes useful, filtering for companies showing strong and often quickening financial growth. EVR's recent financial numbers show a strong growth story:
- Strong Earnings Growth: The company's Trailing Twelve Month (TTM) EPS has grown by 60% year-over-year. Recent quarterly performance is more notable, with the last reported quarter showing EPS growth of 70.6% compared to the same quarter last year.
- Steady Earnings Surprises: EVR has beaten analyst EPS estimates in each of the last four quarters, with an average surprise of over 40%. This steady outperformance can work as a trigger, drawing more institutional interest.
- Solid Revenue Growth: Top-line growth is also solid, with TTM revenue up 27% and last quarter's sales growing by 41.6% year-over-year. Sound revenue growth gives a firm base for continued earnings power.
- Getting Better Profitability: The company's profit margin in the last reported quarter was 13.8%, showing a gain from the 11.6% margin in the prior quarter. Growing margins point to operational efficiency and pricing power.
- Positive Analyst Changes: Analysts have been increasing their estimates, with the average EPS forecast for the next fiscal year rising by about 4% over the last three months. Upward changes often come before more price gains.
This mix of quickening earnings, solid revenue growth, and positive estimate changes fits the fundamental "fuel" that Minervini looks for in his high-performance setups.
Combination: Strategy Fit
The Minervini strategy is strong because it needs both parts to be present: a technically sound chart and a fundamentally strong story. EVR seems to show this mix. The Trend Template rules make sure the stock is in a good technical place, lowering risk by confirming the trend's direction. At the same time, the high-growth fundamentals give the reason for why the stock is trending, finding it not just as a technical event, but as a business seeing real, market-seen growth. This double check is key to the strategy's goal of finding leaders with the possibility for large further price gains.
Technical Study Summary
ChartMill's separate technical report for EVR gives the stock a high Technical Rating of 8 out of 10, noting its steady performance in both short and long-term timeframes. The report labels the long-term trend as positive and points out the stock's leadership in the Capital Markets industry, where it does better than 85% of its peers. While the short-term trend is currently neutral, hinting at a time of consolidation, the report also notes a recent "Pocket Pivot" signal, a volume-based sign often linked to institutional buying during a pause in the trend. For a full list of support/resistance levels and the complete study, you can see the full technical report for EVR.
Finding Like Opportunities
EVERCORE INC - A works as a real example of a stock that currently fits a strict growth and momentum filtering process. Investors curious about locating other possible choices that meet similar firm technical and fundamental growth rules can look at the preset screen. Click here to view the "High Growth Momentum + Trend Template" screen for new results.
Disclaimer: This article is for informational and educational purposes only. It is not a recommendation to buy or sell any security. The analysis is based on current data and a specific investment methodology. Investors should conduct their own thorough research and consider their individual financial situation and risk tolerance before making any investment decisions. Past performance is not indicative of future results.
