Futu Holdings Ltd-ADR (NASDAQ:FUTU) Emerges as a Strong CAN SLIM Contender

Futu Holdings Ltd-ADR (NASDAQ:FUTU) has appeared as a notable candidate for investors using the CAN SLIM methodology, a growth-focused investment system made popular by William O’Neil. This method brings together fundamental and technical study to find market-leading stocks with solid earnings momentum, good institutional support, and positive chart patterns, all within the setting of a bullish market. The system highlights companies showing major quarterly and yearly growth, better relative strength, and acceptable debt, while also considering wider market conditions.

Futu’s fundamental profile matches strongly with several main CAN SLIM points. The company reported a notable 103.67% year-over-year growth in quarterly earnings per share, greatly passing the minimum level of 20% highlighted in the “C” point for current quarterly earnings acceleration. Revenue growth was also strong at 69.73%, exceeding the 25% standard and pointing to solid business development. These numbers indicate Futu is not just growing but doing so at a quickening rate, a main feature wanted by CAN SLIM investors.

Yearly earnings rises, shown by the “A” in CAN SLIM, need a history of major growth. Futu’s three-year EPS compound annual growth rate of 28.79% easily passes the 25% minimum, showing steady and solid basic profitability. Also, the company’s return on equity is 23.77%, much above the 10% guide, pointing to good use of shareholder money and high-grade earnings, a basic part of the system.

From a technical view, Futu shows features that meet the “N” (new highs) and “L” (leader) parts of the system. The stock has a relative strength rating of 97.84, meaning it has done better than almost 98% of the market, a clear sign of leadership. It is also trading close to its 52-week high, which often shows institutional buying and breaks from consolidation patterns, both of which are positive signals under CAN SLIM. The total technical rating of 10/10 shows solid momentum across short and long-term periods.

The “S” point, which deals with supply and demand forces, is backed by Futu’s good balance sheet. The company keeps a debt-to-equity ratio of 0.28, much below the highest level of 2, pointing to a careful capital structure and less financial risk. This fits with the system’s liking for companies with solid financial health and lasting growth models.

Institutional sponsorship, the “I” in CAN SLIM, is another area where Futu matches the profile. With institutional ownership at 42.78%, the stock shows real interest from bigger investors without being too owned, which can restrict future buying pressure. This level of ownership suggests increasing recognition among professional money managers while allowing space for more institutional buying.

Finally, the “M” for market direction is currently positive, with both short and long-term trends for the S&P 500 in good standing. CAN SLIM highlights investing in leading stocks during bull markets to better the chance of success, and Futu’s solid performance happens within this supportive wider setting.

In summary, Futu offers a notable case for CAN SLIM investors because of its outstanding earnings and sales growth, high relative strength, good financial numbers, and technically positive stance. While the company shows small issues in financial health, as noted in its fundamental report, its total growth path and market position seem solid. The stock also shows a hopeful technical structure, detailed more in its technical analysis.

For investors wanting to look into other stocks that fit similar CAN SLIM points, more screening results are ready through this pre-configured screener.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own research and consider their financial situation before making any investment decisions.