A common task for investors is finding companies with sound basic business condition that are also near a notable price shift. One way to handle this is by merging fundamental and technical study, looking for stocks that show solid growth, earnings, and financial soundness while also displaying encouraging technical breakout formations. This two-part method tries to locate companies where good business basics create a base for expansion, and a constructive technical arrangement indicates market force may be coming together to push the stock price upward. A recent filter for "Strong Growth Stocks with good Technical Setup Ratings" has identified one of the market's most noticeable technology leaders for further study.
ALPHABET INC-CL A (NASDAQ:GOOGL) comes forward from this study as a notable candidate. The company, the owner of Google, is a giant in interactive media and cloud services, but the information indicates it keeps showing traits of a solid growth stock while offering a positive technical view.
Fundamental Soundness: The Base for Expansion
The fundamental argument for Alphabet is solid, as described in its detailed fundamental analysis report. The company receives very high scores in two important areas for growth investors: earnings ability and financial condition, both getting a 9 out of 10.
- Outstanding Earnings Ability: Alphabet's profit margins set the standard in its field. Its operating margin of 32.83% and return on invested capital (ROIC) of almost 25% are better than most of its competitors. This shows a very effective business system that changes income into earnings efficiently, a central feature for lasting growth.
- Very Strong Financial Condition: With a very small debt-to-equity ratio of 0.06 and an Altman-Z score showing almost no failure risk, Alphabet has a very strong balance sheet. This financial soundness gives the company great ability to put money into new ideas, get through economic slowdowns, and follow strategic options without difficulty.
- Proven and Anticipated Expansion: The growth score of 7/10 is backed by strong past and forecasted increase. Over the last year, earnings per share (EPS) rose more than 30%, while income went up by 13.4%. Experts think this pace will carry on, with future EPS and income growth forecast in the middle-to-upper teens. This steady performance is key to the growth investment idea, as investors look for companies that can steadily enlarge earnings quicker than the market norm.
While its price assessment, with a P/E ratio higher than the S&P 500 average, scores a more average 4/10, the report comments that this higher price may be reasonable given the company's excellent earnings ability and anticipated growth path.
Technical Force: The Arrangement for a Breakout
Adding to this sound fundamental picture is a very positive technical perspective. The technical analysis report gives GOOGL a top score of 10/10, with a specific setup score of 7/10 pointing to a possible trade chance.
- Strong Trend Agreement: Both the near-term and longer-term trends for GOOGL are scored as positive. The stock is priced above all its main simple moving averages (20, 50, 100, and 200-day), which are all going up, a clear sign of continued upward force.
- Trading Close to Highs with Pause: The stock is now trading near its 52-week high, having done much better than both the wider market and its industry counterparts over the past year. Lately, prices have been pausing within a band, which frequently comes before the next price move.
- A Clear Technical Arrangement: The study points out a definite resistance level just above the present price. A clear move above this area could mark the next upward step. The arrangement indicates little obstruction above if a breakout happens, with a support zone below giving a sensible place for a stop-loss order. This formation is exactly what the filtering method looks for: a fundamentally sound stock holding still before a possible technical breakout.
Why This Pairing Is Important
The combination between these reports is what makes the filtering tactic effective. The fundamental study answers the why, Alphabet is a financially sound, very profitable company with a proven growth system. The technical study deals with the when, the stock's price movement shows strong force and is forming in a way that often leads to more gains. For growth investors, this pairing lowers risk; they are not just following a chart formation in a poor company, nor are they putting money into a sound business that the market has overlooked. Instead, they are finding a good quality growth stock at a moment when market forces may be coming together to benefit it.
This filter for strong growth stocks with positive technical arrangements is made to find more chances like Alphabet. If you want to look into other companies that meet these strict paired conditions, you can see the complete list of outcomes through the Strong Growth Stock Technical Setups Screen.
Disclaimer: This article is for information only and is not financial guidance, a suggestion, or a bid or request to buy or sell any securities. The study is based on information and reports given by other parties. Investing has risk, including the possible loss of original money. You should do your own study and talk with a certified financial consultant before making any investment choices. Past results are not a guide for future outcomes.
