Unlocking the high Growth Potential of FUTU HOLDINGS LTD-ADR (NASDAQ:FUTU).

A possible breakout setup was detected on FUTU HOLDINGS LTD-ADR (NASDAQ:FUTU) by our stockscreener. A breakout pattern is formed when a stock consolidates after a strong rise up. We note that this pattern is detected purely based on technical analysis and whether the breakout actually materializes remains to be seen. It could be interesting to keep an eye on NASDAQ:FUTU.

Analyzing the Technical Aspects

As part of its analysis, ChartMill provides a comprehensive Technical Rating for each stock. This rating, ranging from 0 to 10, is updated on a daily basis and is based on the evaluation of various technical indicators and properties.

We assign a technical rating of 10 out of 10 to FUTU. Both in the recent history as in the last year, FUTU has proven to be a steady performer, scoring decent points in every aspect analyzed.

• Both the short term and long term trends are positive. This is a very positive sign.
• Looking at the yearly performance, FUTU did better than 97% of all other stocks. We also observe that the gains produced by FUTU over the past year are nicely spread over this period.
• FUTU is part of the Capital Markets industry. There are 223 other stocks in this industry. FUTU outperforms 98% of them.
• FUTU is currently trading in the upper part of its 52 week range. The market is still in the middle of its 52 week range, so FUTU slightly outperforms the market at the moment.
• In the last month FUTU has a been trading in the 101.54 - 130.88 range, which is quite wide. It is currently trading in the middle of this range where prices have been consolidating recently, this may present a good entry opportunity, but some resistance may be present above.

Our latest full technical report of FUTU contains the most current technical analsysis.

Why is FUTU a setup?

ChartMill takes into account not only the Technical Rating but also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, FUTU exhibits a 8 setup rating, indicating its consolidation status in recent days and weeks.

FUTU has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is very little resistance above the current price. We notice that large players showed an interest for FUTU in the last couple of days, which is a good sign. Another positive sign is the recent Pocket Pivot signal.

ChartMill's Evaluation of Growth

Every stock receives a High Growth Momentum Rating (HGM) from ChartMill, ranging from 0 to 10. This rating assesses various growth and profitability aspects, including historical and projected EPS and revenue growth. FUTU boasts a 6 out of 10:

Explosive Earnings Growth

• The EPS of FUTU has exhibited growth from one quarter to another (Q2Q), with a 104.0% increase. This underscores the company's ability to generate higher earnings and improve its financial standing.
• The earnings per share (EPS) growth of FUTU is accelerating: the current Q2Q growth of 104.0% is above the previous quarter Q2Q growth of 20.05%. Earnings momentum and acceleration are key for high growth systems.
• Sales growth accelerated for 3 quarters in a row.
• Over the past year, FUTU has demonstrated 26.28% growth in EPS, signifying its positive financial trajectory and potential for future profitability.
• Over the past 3 years, FUTU has demonstrated 28.79% growth in EPS, signifying its positive financial trajectory and potential for future profitability.
• FUTU has demonstrated strong quarter-to-quarter (Q2Q) revenue growth of 86.77%, reflecting its ability to generate consistent increases in sales. This growth highlights the company's effective market positioning and its potential for continued success.
• The sales growth of FUTU is accelerating: the current Q2Q growth of 86.77% is above the previous quarter Q2Q growth of 29.65%. Sales momentum and acceleration are key for high growth systems.
• Sales acceleration happened 3 quarters in a row.
• With notable 1-year revenue growth of 35.79%, FUTU exemplifies its ability to generate increased sales and revenue streams. This growth signifies the company's strong business performance and its potential for future growth.
• FUTU has surpassed EPS estimates 3 times in the last 4 quarters, reflecting its strong financial performance and effective management. This trend suggests the company's ability to generate positive earnings surprises and drive shareholder value.

Profitability & Financial Strength

• With a favorable Return on Equity (ROE) of 19.43%, FUTU demonstrates its ability to deliver attractive returns for shareholders. This metric highlights the company's effective management of assets and its profitability.
• Maintaining a Debt-to-Equity ratio of 0.3, FUTU demonstrates a conservative financial approach. This signifies the company's focus on minimizing debt burdens while preserving a solid equity position.

Market Strength

• FUTU has achieved an impressive Relative Strength (RS) rating of 97.51, showcasing its ability to outperform the broader market.

More ideas for high growth momentum breakouts can be found on ChartMill in our High Growth Momentum Breakout screen.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.