Does HESAI GROUP (NASDAQ:HSAI) meet the Minervini criteria?

Our stock screener has spotted HESAI GROUP (NASDAQ:HSAI) as a stocks which checks several boxes as specified by Mark Minervini. We will dive into an analysis below.

A Technical Analysis using the Minervini Trend Template.

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

• ✔ 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 HSAI a High Growth Stock.

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. HSAI boasts a 5 out of 10:

Earnings Momentum

• HSAI has demonstrated consistent growth in its earnings per share (EPS) from one quarter to another (Q2Q), with a 259.0% increase. This indicates improving financial performance and the company's effective management of its operations.
• HSAI shows accelerating EPS growth: when comparing the current Q2Q growth of 259.0% to the previous quarter Q2Q growth of 58.02%, we see the growth rate improving.
• Sales acceleration happened 3 quarters in a row.
• HSAI has experienced 102.0% growth in EPS over a 12 month period, demonstrating its ability to generate sustained and positive earnings momentum.
• HSAI has achieved significant quarter-to-quarter (Q2Q) revenue growth of 28.26%, signaling its ability to capture market opportunities and drive top-line expansion. This growth underscores the company's effective execution and its potential for continued success.
• The sales growth of HSAI is accelerating: the current Q2Q growth of 28.26% is above the previous quarter Q2Q growth of 21.06%. Sales momentum and acceleration are key for high growth systems.
• Sales growth accelerated for 3 quarters in a row.
• Analysts' average next Quarter EPS Estimate for HSAI has witnessed a 47.92% change in the last 3 months, underscoring the evolving market expectations towards the company's EPS prospects.
• HSAI 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

• HSAI has shown positive growth in its operating margin over the past year, indicating improved operational efficiency. This growth highlights the company's ability to effectively manage costs and maximize profitability.
• The free cash flow (FCF) of HSAI has seen steady growth over the past year, indicating enhanced cash flow generation and financial health. This trend underscores the company's effective capital management and its ability to generate sustainable cash flows.
• HSAI exhibits a favorable Debt-to-Equity ratio at 0.09. This highlights the company's ability to limit excessive debt levels and maintain a strong equity base, demonstrating its financial stability and risk management practices.

Institutional Confidence & Market Strength

• The ownership composition of HSAI reflects a balanced investor ecosystem, with institutional shareholders owning 51.31%. This indicates a broader market participation and potential for increased trading liquidity.
• HSAI has achieved an impressive Relative Strength (RS) rating of 98.94, showcasing its ability to outperform the broader market.

How do we evaluate the setup for HSAI?

The Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For HSAI this score is currently 3:

HSAI has an average technical rating and it also does not offer a high quality setup at the moment. Price movement has been a little bit too volatile to find a nice entry and exit point. It is probably a good idea to wait for a consolidation first.

For an up to date full technical analysis you can check the technical report of HSAI

Concluding

It looks like HESAI GROUP meets the Minervini criteria. More high growth momentum breakout stocks can be found 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.