HESAI GROUP (NASDAQ:HSAI) Combines High Growth Momentum with Technical Breakout Setup

Hesai Group (NASDAQ:HSAI) has become a notable candidate for investors using a high growth momentum strategy blended with technical breakout analysis. This method looks for companies showing solid earnings acceleration, good sales growth, and positive estimate revisions, all signs of high growth momentum, while also displaying positive technical conditions that point to a possible breakout from a consolidation pattern. The method depends on the combination of fundamental momentum and technical timing, trying to capture stocks positioned for notable upward moves.

Fundamental Growth Momentum

Hesai Group’s fundamental profile matches well with the criteria wanted by high growth momentum investors. The company’s earnings per share (EPS) growth has been remarkable, with a trailing twelve-month (TTM) year-over-year rise of 160.89%. More notably, recent quarterly performance shows even greater acceleration: the latest quarter saw EPS jump by 255.88% compared to the same quarter last year, while the prior quarter recorded a 111.11% increase. This pattern of quickening earnings growth is a key part of the High Growth Momentum Rating, as it shows not just growth, but a rising rate of growth that frequently comes before more price appreciation.

Sales growth has also been solid and steady. Revenue rose by 36.48% over the TTM period, with the latest quarter showing a 53.94% year-over-year increase. The company has shown a capacity to beat expectations, with an average EPS surprise of 12.66% over the last four quarters. These parts, quickening earnings, good sales growth, and positive surprises, are exactly what the High Growth Momentum Rating aims to capture, and Hesai’s score of 6 shows good performance in these areas.

Technical Strength and Setup Quality

From a technical viewpoint, Hesai offers an equally positive case. The stock has received a perfect Technical Rating of 10 from ChartMill, showing very good technical health across multiple timeframes. Both short-term and long-term trends are positive, and the stock is trading near its 52-week high while doing better than 99% of all stocks in the market over the past year. Relative strength is especially significant, with the stock showing better performance compared to 100% of its peers in the Automobile Components industry.

The Setup Rating of 7, while not at the top level, still shows a workable consolidation pattern. According to the technical analysis report, the stock has been trading in a range between $17.90 and $27.94 over the past month and is now nearing the upper end of this range. The report finds several clear support zones, including a good support area between $23.06 and $23.26 made by multiple trend lines and moving averages. This gives a defined risk management level for traders looking at a breakout play.

Integration of Fundamentals and Technicals

The mix of good fundamental momentum and technical consolidation makes Hesai an interesting candidate for investors following this strategy. The fundamental growth metrics indicate the company is in a good operational phase, while the technical pattern shows the stock is gathering energy for a possible move higher. The nearness to resistance around $26.67 gives a defined level to monitor for breakout confirmation.

For investors wanting to look into similar opportunities, more candidates meeting these criteria can be found through this High Growth Momentum Breakout Setups screen. The screen finds stocks with High Growth Momentum Ratings above 6, Technical Ratings above 7, and Setup Ratings above 7, offering a selected list of possible breakout candidates with good fundamental bases.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. The analysis presented should not be interpreted as a recommendation to buy or sell any security. Investors should conduct their own research and consider their individual financial circumstances before making investment decisions.