SHIFT4 PAYMENTS INC-CLASS A (NYSE:FOUR) stands out as a high-growth momentum candidate with a solid technical setup. The company, a leading provider of payment processing solutions, has demonstrated strong earnings and revenue growth while presenting a favorable chart pattern for potential breakout traders.
Fundamental Strengths Supporting High Growth Momentum
Earnings Growth: FOUR reported a 54.5% year-over-year increase in EPS (TTM), with recent quarterly EPS growth exceeding 98%.
Revenue Expansion: Sales grew 27.4% over the past year, with consistent double-digit growth in recent quarters.
Profit Margin Improvement: The company’s profit margin expanded to 6.8% in the last fiscal year, up from 3.4% two years prior.
Positive Revisions: Analysts have raised next-year EPS estimates by 16.4% over the past three months, reflecting improving sentiment.
FOUR holds a Technical Rating of 7 and a Setup Rating of 8, signaling both a healthy trend and a consolidation pattern that may precede a breakout. Key observations from the technical report include:
Bull Flag Formation: The stock is forming a bullish continuation pattern after a strong upward move.
Support and Resistance: A key support zone lies between $87.24 and $89.91, while resistance sits near $90.99 to $92.14. A breakout above this level could signal further upside.
Relative Strength: FOUR outperforms 80% of stocks in the Financial Services sector, indicating strong market leadership.
Volume Trends: Recent pullbacks have occurred on lower volume, a positive sign for continuation.
Why This Setup Matters for Traders
High-growth stocks with strong technical setups often attract momentum investors. FOUR’s combination of accelerating earnings, expanding margins, and a well-defined chart pattern makes it a candidate for both growth and breakout strategies.