A method for stock selection often joins strict technical rules with an attention to basic growth factors. The process used here brings together Mark Minervini's Trend Template, a tested model for finding stocks in strong uptrends, with a screen for High Growth Momentum (HGM). This two-part method tries to locate companies that are showing both good price momentum and institutional backing on the charts, and also displaying the basic profit and sales speed that can support continued gains. By following these joined screens, the plan works to separate leaders early in their growth phases.
Neuraxis Inc (NYSEARCA:NRXS) appears as a present candidate from this scanning process, offering a strong case for more review by growth-focused investors.
Technical Strength: Matching the Minervini Trend Template
The center of Minervini's plan is the Trend Template, a group of fixed technical rules made to confirm a stock is in a definite, long-term uptrend (Stage 2). NRXS now meets these important measures, which are basic for controlling risk by trading with the main trend.
- Trending Moving Averages: The stock's price is trading well above its main moving averages (50-day: $5.05, 150-day: $3.55, 200-day: $3.31). Importantly, these averages are ordered in the correct bullish order—the 50-day is above the 150-day, which is above the 200-day—and each is moving upward. This order shows continued buying pressure across several time periods.
- Nearness to Highs: A principle of the plan is to focus on strength, not low price. NRXS is trading within 8% of its 52-week high of $7.43, showing leadership and an absence of overhead supply. At the same time, its present price is about 416% above its 52-week low, confirming a strong recovery and uptrend are already in place.
- Better Relative Strength: Maybe most significant is the stock's ChartMill Relative Strength (CRS) score of 98.86. This means NRXS is doing better than nearly 99% of all stocks in the market over the past year. Minervini states that real market leaders show high relative strength, often moving higher before the wider market improves.
Fundamental Speed: The High Growth Momentum Case
While the Trend Template finds the "how" of a stock's price action, the High Growth Momentum screen looks to explain the "why" by checking fundamental speed. For a growth stock to maintain a strong trend, it usually needs better financial numbers. NRXS displays several positive signs of business momentum.
- Strong Earnings Growth Path: The company is showing major gain in its bottom line. Earnings Per Share (EPS) for the trailing twelve months (TTM) increased by about 66.7% year-over-year. More significantly, recent quarterly comparisons show speeding growth, with the last reported quarter showing EPS growth of 47.6% compared to the same quarter a year before.
- Good and Speeding Revenue Growth: Top-line increase is a important driver for growth companies. NRXS reported TTM revenue growth of 41.8%. The speed is clear in recent quarters, with sales growth of 46.6% in the last quarter, after a 38.5% gain in the quarter before. This pattern of repeated, high double-digit quarterly sales growth is a main trait looked for by growth investors.
- Route to Profitability: Although the company is not yet profitable on a net income basis, the large year-over-year gain in EPS and good revenue growth suggest it is on a route toward smaller losses and possibly reaching profitability, a common story for successful growth-stage medical technology companies.
Combination: Why the Match is Logical
The coming together of technical and fundamental points is what makes NRXS a notable candidate. The strong price trend, marked by new highs and better relative strength, is probably being driven by the improving fundamental story of speeding revenue and earnings growth. Institutional investors often start gathering shares expecting or reacting to such improving fundamentals, which then creates the technical view of good trend order and high relative strength. This creates a possible positive cycle where improving business results attract money, which pushes the price higher, confirming the technical picture.
Technical Report Summary
A check of the detailed ChartMill Technical Analysis Report for NRXS supports the scanning results. The report gives NRXS a top-level technical rating of 10 out of 10, noting its strong positive long-term and short-term trends, leader position within its sector, and recent high-volume breakout action. The report does note that the recent changeable price movement has led to a lower setup quality score, suggesting that while the trend is very good, new entries might be better looked for during a time of consolidation or measured pullback rather than following the extended move.
Find More Possible Leaders
The joining of the Minervini Trend Template and High Growth Momentum screens is made to methodically find stocks like NRXS that show both technical skill and fundamental speed. This scan is done often to locate new opportunities as market states change.
You can see the present results of this "High Growth Momentum + Trend Template" scan and find other possible candidates by clicking here.
Disclaimer: This article is for informational and educational purposes only. It is not a recommendation to buy or sell any security. The analysis is based on data provided and scanning methods described. All investing and trading involves risk, including the potential loss of principal. Readers should do their own complete research and consider their personal financial situation before making any investment decisions. Past performance is not indicative of future results.