Modine Manufacturing Co (NYSE:MOD) Presents a Compelling Growth and Technical Setup

Investors looking for businesses with both good fundamental growth traits and positive technical formations might consider Modine Manufacturing Co (NYSE:MOD) an interesting example. The method of using both technical and fundamental analysis tries to find stocks that are not only financially sound and growing quickly but are also at a possible turning point in their price path. By concentrating on stocks displaying technical breakout formations along with good growth, acceptable profitability, and sound financial condition, investors try to find chances where positive company momentum is being supported by market price movement.

Fundamental Growth Profile

Modine’s fundamental situation is characterized by a solid growth narrative, which is the main part of any growth investing method. The company’s work in thermal management solutions for areas like data centers and vehicle electrification places it in growing markets, matching the qualitative need of focusing on a market with large growth possibility. This is shown in its numerical measures, where Modine gets a Growth Rating of 7 out of 10.

• Earnings Per Share (EPS) Growth: The company has shown notable EPS growth, rising by 18.18% over the last year and by a striking 30.99% each year over the last several years.
• Future Growth Expectations: Analyst predictions continue to be high, with EPS expected to grow by 26.64% on average in the next few years. Sales are also expected to increase faster, with estimates of 16.30% growth.
• Profitability Strength: Backing this growth is a very good Profitability Rating of 8. The company has good returns, including a Return on Equity of 17.67%, which is better than 96% of its industry group in the Automobile Components sector. Its operating margin of 11.67% is also one of the better ones in its industry.

You can review the full breakdown in the Modine Manufacturing Co Fundamental Analysis Report.

Valuation and Financial Health Considerations

While the growth and profitability scores are good, a full review needs looking at valuation and financial health. Modine’s Valuation Rating is a low 2, showing its shares are valued at a high level compared to both the wider market and its industry. A high Price-to-Earnings ratio often goes with high-growth businesses as investors pay for future earnings possibility, but it does bring more risk if that growth does not happen.

The company’s Financial Health Rating is a neutral 5. There are good indicators, like a sound Current Ratio of 2.00, showing acceptable short-term cash availability. However, a Debt-to-Free-Cash-Flow ratio of 14.03 suggests it would take a long time to pay off all its debt using its present cash flow, a detail for investors to watch. For a growth stock, the main focus stays on the increase of earnings and sales, but financial health gives background for the continuation of that growth.

Technical Setup and Market Position

The technical view for Modine gives an additional positive story. The stock gets a sound Technical Rating of 7, with a particularly notable Setup Rating of 7. This shows the stock is moving within a band after a large upward price change, with lower price swings that often come before a new price direction.

• Trend Analysis: The long-term price direction is positive, and the stock is trading above its important moving averages (50-day, 100-day, and 200-day), which is a positive signal.
• Support and Resistance: An important resistance area is present between $161.28 and $163.03. A clear move above this point could indicate the next part of the upward trend. Under the present price, a support area between $133.77 and $135.18 gives a possible zone where buyers may become active.
• Market Comparison: While the S&P 500's short-term trend is positive, Modine has been a good performer on its own, doing better than 78% of all stocks over the last year, though a lot of that increase was seen in a strong price change several months ago.

The full technical view, including chart review and detailed trade setup points, is available in the Modine Manufacturing Co Technical Analysis Report.

Conclusion

Modine Manufacturing Co shows a profile that fits a growth stock method supported by technical analysis. The company displays good, speeding up earnings growth and works in markets with clear growth possibility. While its valuation is high and its financial health has some small points to consider, its very good profitability helps explain investor positive view. Technically, the stock is in a period of sideways movement with a clear resistance point above; a move above it could show that the market is confirming the good fundamental growth story. For investors, this mix suggests a company that is performing well and might be set for its next price increase, if it can get past nearby technical barriers.

This review of MOD was found using a method that searches for good growth stocks with positive technical formations. If this way of working matches your investment style, you can find more possible choices using the "Strong Growth Stocks with good Technical Setup Ratings" screen here.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial advice, or a recommendation to buy or sell any security. All investments involve risk, and past performance is no guarantee of future results. Always conduct your own research and consider your financial situation and risk tolerance before investing.