Ouster Inc (NASDAQ:OUST) Emerges as a Top Growth Stock Using Minervini's Trend-Following Method

Ouster Inc (NASDAQ:OUST) has appeared as a notable option for investors using systematic growth strategies, especially those using Mark Minervini's trend-following method along with high growth momentum filters. This method finds companies displaying both solid technical momentum and improving fundamental performance, forming a strong pairing for possible market-beating returns.

Technical Strength: Meeting the Trend Template Criteria

Ouster displays very good technical traits that match Minervini's Trend Template needs. The stock shows solid price movement across different time periods, with current trading well above all main moving averages. The moving average arrangement shows a preferred order, with the 50-day SMA located above both the 150-day and 200-day averages, while the 150-day SMA trades above the 200-day SMA, all moving upward. This ordered moving average setup points to continued buying interest across short, intermediate, and long-term periods.

The stock's location compared to its 52-week range adds confirmation to its technical condition. Trading at $33.36, OUST sits about 426% above its 52-week low of $6.34 while staying within 20% of its 52-week high of $41.65. This placement reflects Minervini's liking for stocks that have shown major rebound momentum while staying near new highs, indicating further upward possibility instead of spent momentum.

Exceptional Relative Strength and Market Leadership

Ouster's relative strength ranking of 98.5 puts it in the top 2% of all stocks regarding price performance. This very high ranking is important within the Minervini structure, as it shows the stock is doing much better than the wider market. Inside its Electronic Equipment, Instruments & Components industry group, OUST does better than 96% of similar companies, setting a clear leading position. The stock's notable returns of 300% over six months and 377% over twelve months display the kind of rapid growth that momentum investors look for.

Fundamental Growth Momentum

The high growth momentum filter shows improving fundamental performance across important measures:

Revenue Growth Improvement:

• Quarterly revenue growth has improved from 23.1% to 25.8% to 29.9% over recent quarters
• Full-year revenue growth of 33.4% shows continued expansion
• Forward revenue projections point to ongoing growth momentum

Earnings Improvement Path:

• Quarterly EPS growth shows steady betterment
• Full-year EPS growth of 72.7% shows notable operational improvement
• Several earnings beats in recent quarters increase trust in execution

Cash Flow Generation Advancement:

• Free cash flow per share got better by 89% year-over-year
• Progress toward cash flow positivity indicates business model development

This fundamental improvement matches Minervini's focus on companies going through "big earnings attracting big attention," where better fundamentals draw institutional investor interest, creating a cycle of price gains.

Market Context and Risk Considerations

While Ouster shows solid technical and fundamental traits, investors should be aware the stock's recent trading range is between $27.53 and $41.65. The current price is in the middle of this range, indicating possible resistance above. The stock's very good performance over the past year, while positive, also calls for thought about position size and risk management steps.

Technical Analysis Summary

The full technical report gives OUST a top score of 10 out of 10, reflecting very good technical condition across all assessed time periods. The setup rating of 6 shows a reasonable consolidation pattern with set support and resistance levels. Key support areas are found between $30.61-$30.82 and $29.36-$29.66, giving clear points for stop-loss placement, while resistance starts around $36.83-$37.09, offering possible breakout confirmation points.

View the complete technical analysis report for detailed support and resistance levels

Investment Implications

For investors using the Minervini method, Ouster presents a notable example of matching technical momentum with fundamental improvement. The stock meets all important trend template needs while showing the kind of growth momentum that can push continued market-beating returns. The pairing of high relative strength, correct moving average order, and improving fundamentals creates a situation that deserves notice from growth-focused investors.

Discover More Opportunities

Explore additional high-growth momentum stocks meeting the Minervini Trend Template criteria through our specialized screening tool. This filter methodically finds companies displaying both technical condition and fundamental growth improvement, giving a structured way to find possible investment options.

Disclaimer: This analysis is for informational and educational purposes only and does not constitute investment advice. All investments carry risk, and past performance is not indicative of future results. Investors should conduct their own research and consult with financial advisors before making investment decisions. The author and publisher are not responsible for any investment decisions made based on this information.