OLO INC - CLASS A (NYSE:OLO) Combines Technical Strength and Fundamental Momentum for Growth Investors

In the world of growth investing, combining technical strength with fundamental momentum can be a good approach for identifying possible market leaders. One method that brings together these parts is Mark Minervini’s Trend Template, which highlights stocks in strong uptrends, supported by solid price action, moving averages, and relative strength. When this technical structure is paired with a High Growth Momentum (HGM) screen, focusing on companies showing accelerated earnings, revenue expansion, and positive revisions, it creates a structured process for finding equities with both chart strength and business momentum. This article looks at OLO INC - CLASS A (NYSE:OLO) through this dual view, evaluating its fit with Minervini’s criteria and its interest to growth-focused investors.

Technical Strength: Meeting the Minervini Trend Template

OLO shows a solid technical profile that meets the main requirements of Minervini’s Trend Template, made to find stocks in established uptrends with lower volatility and strong momentum.

• Price Above Key Moving Averages: The current price of $10.23 trades well above the 50-day ($9.74), 150-day ($8.04), and 200-day ($7.81) simple moving averages. This multi-layered position points to continued bullish momentum across short, medium, and long-term timeframes, a key part of Minervini’s method for confirming trend strength.
• Upward Sloping Moving Averages: Both the 150-day and 200-day moving averages are rising, supporting the quality of the long-term uptrend. The 50-day moving average is also above the 150-day and 200-day averages, indicating increasing momentum and a technically sound stock.
• Position Relative to 52-Week High/Low: Trading at $10.23, OLO is within 25% of its 52-week high of $10.545 and has gained over 120% from its 52-week low of $4.56. This shows strong recovery and momentum, important features Minervini looks for, as stocks near highs often lead their sectors.
• Superior Relative Strength: With a ChartMill Relative Strength rating of 93.32, OLO performs better than 93% of all stocks in the market. High relative strength is vital in Minervini’s strategy, as it shows market leadership and implies the stock is being bought by institutional investors.

Fundamental Momentum: Qualifying for High Growth Investing

Beyond technicals, OLO shows fundamental traits that fit with high-growth investing, showing clear improvement in profitability, sales expansion, and analyst sentiment.

• Earnings Growth and Acceleration: The company reported EPS (TTM) of $0.26, a 36.8% year-over-year increase. Quarterly EPS growth has been solid, with the most recent quarter up 40% year-over-year, and the previous two quarters showing 40% and 20% growth, in that order. This pattern of increasing growth is precisely what growth investors seek, consistent and getting better profitability.
• Revenue Expansion: Revenue growth stays strong, with a 21.9% increase over the trailing twelve months. The latest quarter saw sales grow 21.6% year-over-year, keeping a steady rate that implies demand for OLO’s SaaS platform for restaurants is durable.
• Positive Estimate Revisions: Analysts have raised their next-year EPS estimates by 1.68% over the past three months, showing increasing optimism about OLO’s future earnings potential. Such revisions frequently come before further price appreciation as institutional investors update their models.
• Profit Margin Trends: The profit margin in the last quarter was 1.84%, showing some variation but staying positive. For a growth company in expansion mode, keeping positive margins while growing quickly is a good sign, though investors will monitor for further steadiness or improvement.

High-Level Technical Overview

A review of OLO’s technical analysis report shows more positive signals. The stock gets a perfect technical rating of 10/10, reflecting very good health across short and long-term trends. The setup rating is 7/10, pointing to a reasonable consolidation pattern with lower volatility and a set support zone near $10.21. With the stock trading near its 52-week high and showing a bull flag pattern, a usually bullish continuation formation, the technical situation implies room for more upside if momentum persists.

Conclusion and Further Research

OLO makes a solid case for investors using a combined technical and fundamental growth strategy. It meets the strict requirements of the Minervini Trend Template, confirming a strong uptrend with superior relative strength, while its fundamental profile shows accelerating earnings, good revenue growth, and positive analyst revisions. For those interested in finding similar opportunities, more stocks matching these criteria can be found through this High Growth Momentum + Trend Template screen.

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