Is GOOSEHEAD INSURANCE INC -A (NASDAQ:GSHD) following the Minervini trend for explosive growth?

Our stock screener has spotted GOOSEHEAD INSURANCE INC -A (NASDAQ:GSHD) as a stocks which checks several boxes as specified by Mark Minervini. We will dive into an analysis below.

Minervini Trend Template Analysis.

The Minervini Trend Template is a set of technical criteria designed to identify stocks in strong uptrends. We can check all the boxes for GSHD:

• ✔ Relative Strength is above 70.
• ✔ Current price is within 25% of it's 52-week high.
• ✔ Current price is at least 30% above it's 52-week low.
• ✔ The current price is above the 50-, 150- and 200-day SMA price line.
• ✔ The SMA(200) is trending upwards.
• ✔ The SMA(150) is above the SMA(200)
• ✔ The SMA(50) is above the SMA(150) and the SMA(200)

Why we can consider GSHD a High Growth Stock.

ChartMill assigns a High Growth Momentum Rating (HGM) to every stock. This score ranges from 0 to 10 and evaluates the different growth and profitability aspects, including accelleration, surprises and revisions. GSHD scores a 5 out of 10:

Explosive Earnings Growth

• GSHD has demonstrated consistent growth in its earnings per share (EPS) from one quarter to another (Q2Q), with a 182.0% increase. This indicates improving financial performance and the company's effective management of its operations.
• GSHD shows accelerating EPS growth: when comparing the current Q2Q growth of 182.0% to the previous quarter Q2Q growth of 8.7%, we see the growth rate improving.
• EPS acceleration happened 2 quarters in a row.
• The 1-year EPS growth of GSHD (51.52%) highlights the company's ability to consistently improve its earnings performance and suggests a positive outlook for future profitability.
• The EPS of GSHD has shown consistent growth over a 3-year period, indicating the company's ability to generate increasing earnings over time.
• The recent q2q revenue growth of 49.05% of GSHD showcases the company's ability to generate increasing revenue in a short period, reflecting its positive growth trajectory.
• The sales growth of GSHD is accelerating: the current Q2Q growth of 49.05% is above the previous quarter Q2Q growth of 9.86%. Sales momentum and acceleration are key for high growth systems.
• GSHD has demonstrated strong 1-year revenue growth of 20.37%, reflecting revenue momentum and its ability to generate consistent top-line expansion. This growth underscores the company's strong market position and its potential for future success.
• GSHD has exceeded EPS estimates 3 times in the last 4 quarters, demonstrating its ability to outperform market expectations. This trend highlights the company's strong financial performance and its potential for future growth.

Financial Strength & Profitability

• With positive growth in its operating margin over the past year, GSHD showcases its ability to improve profitability through effective cost control and operational efficiency. This growth underscores the company's commitment to enhancing its financial performance.
• The profit margin of GSHD has seen steady growth over the past year, signaling improved profitability.
• GSHD has experienced notable growth in its free cash flow (FCF) over the past year, signaling improved cash generation and strong financial performance. This growth suggests the company's ability to generate excess cash for reinvestment or shareholder returns.
• With a favorable Return on Equity (ROE) of 32.89%, GSHD demonstrates its ability to deliver attractive returns for shareholders. This metric highlights the company's effective management of assets and its profitability.
• A Debt/Equity ratio of 1.45 indicates that GSHD is leveraging debt effectively without excessive risk.

Market Strength & Institutional Confidence

• The ownership composition of GSHD reflects a balanced investor ecosystem, with institutional shareholders owning 110.0%. This indicates a broader market participation and potential for increased trading liquidity.
• GSHD has maintained a healthy Relative Strength (RS) over the analyzed period, with a current 93.51 rating. This demonstrates the stock's ability to outperform its peers and indicates its competitive positioning. GOOSEHEAD INSURANCE INC -A is well-positioned for potential price growth opportunities.

Looking at the Setup

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for GSHD is 7:

GSHD has an excellent technical rating and also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is very little resistance above the current price. There is a support zone below the current price at 112.15, a Stop Loss order could be placed below this zone.

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

Concluding

More ideas for high growth momentum stocks can be found on ChartMill in our High Growth Momentum + Trend Template screen.

Disclaimer

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.