For investors looking for a methodical way to find high-growth stocks ready for a technical breakout, a multi-part screening tactic can be very useful. This tactic merges three specialized ChartMill ratings: a High Growth Momentum (HGM) Rating to select for solid fundamental earnings momentum, a Technical Rating to confirm the stock is in a good uptrend, and a Setup Rating to identify stocks forming a base before a possible advance. The aim is to locate companies where strong business improvement matches a technically good and well-timed chart formation. One stock that recently appeared from this kind of screen is MasTec Inc (NYSE:MTZ).
High Growth Momentum Fundamentals
MasTec's attraction for momentum investors starts with its core business results, which give it a good HGM Rating of 6. This number combines several important growth and momentum measures, and a closer inspection of the data shows the reasons for the score.
- Strong Earnings Growth: The company has shown very good year-over-year earnings per share (EPS) growth. The latest trailing twelve-month (TTM) EPS increased almost 90% from the earlier period. More notable is the quarterly momentum, with EPS growth rates for the past four quarters reported at 118%, 492%, 55%, and 52%.
- Steady Earnings Surprises: A sign of good momentum is a company's record of regularly surpassing analyst forecasts. MasTec has exceeded EPS estimates in all of the last four quarters, with an average surprise above 19%.
- Growing Profitability: The company's profit margin has shown marked quarter-to-quarter gain, increasing from 0.35% two quarters ago to 4.05% in the latest quarter. This pattern of growing margins is a key part of the HGM Rating, showing not only revenue growth but also better operational efficiency and bottom-line improvement.
- Positive Analyst Revisions: Future estimates have been increasing, with the average EPS estimate for the next fiscal year raised by 1.69% over the past three months. This points to building confidence among analysts about the company's short-term outlook.
For the high growth momentum tactic, these elements are most important. The tactic looks for companies where earnings momentum is increasing, surprises are good, and future outlooks are improving, all of which build the possibility for notable stock price growth as the market acknowledges and values this better fundamental situation.
Technical Strength and Setup Quality
While good fundamentals give the "why," technical analysis gives the "when." According to the detailed ChartMill Technical Report, MasTec displays very good technical condition paired with a promising setup formation.
- Top Technical Rating: MasTec receives a best-possible Technical Rating of 10 out of 10. This score shows a uniformly good showing across different time periods. Important technical strengths include:
- Both the short-term and long-term trends are seen as positive.
- The stock is priced above all its main moving averages (20, 50, 100, and 200-day), and these averages are all arranged in a rising pattern.
- It is a market leader, doing better than 89% of all stocks over the last year and 79% of similar companies in the Construction & Engineering field.
- The stock is now trading close to its 52-week high, confirming the force of the current uptrend.
- Good Setup for Entry: With a Setup Rating of 7, the chart displays a phase of recent consolidation after a good upward move. The report states that prices have been moving in a band between about $213 and $249 over the last month and are presently near the top of that band. This consolidation lets the stock reduce any overbought state and establish a base of support.
- Clear Risk Levels: The technical analysis finds specific support and resistance areas, which are important for trade planning. A major support zone is present between $214.21 and $230.44, made from a mix of moving averages and trendlines. The closest resistance is marked near $242.32. A move above this resistance could indicate the restart of the main uptrend.
This pairing is exactly what the screening method tries to find: a stock with excellent technical qualities (Rating of 10) that is now resting in a consolidation (Setup Rating of 7), giving a possible entry point with clear risk levels.
Conclusion
MasTec Inc offers a notable example for the merged high-growth momentum and technical breakout tactic. Fundamentally, the company is experiencing a strong earnings acceleration phase, shown by very high EPS growth, growing margins, and positive analyst revisions. Technically, the stock is in a verified long-term uptrend and is currently pausing in a consolidation formation, preparing for a possible next upward move. The match of these good fundamental momentum signals with a technically sound and well-timed chart setup makes MTZ a stock deserving more examination for investors using this structured method.
Find Other Possible Setups This review of MTZ came from a particular screen merging High Growth Momentum, Technical, and Setup Ratings. Investors can use this screen themselves to locate other possible chances that match this description. You can see the present results and adjust the settings using the High Growth Momentum Breakout Setups Screen.
Disclaimer: This article is for information only and is not investment advice, a suggestion, or an offer to buy or sell any security. The review uses given data and shows the situation when written. Investors should do their own complete research, think about their personal money situation, and talk with a qualified financial advisor before making any investment choices. Past results do not guarantee future outcomes.
