The method used to find possible investment choices joins a strict technical structure with an emphasis on fundamental growth speed. This process is guided by the organized tactics of noted trader Mark Minervini, which favor stocks showing solid, confirmed uptrends, what Minervini calls "Stage 2" moves, along with speeding business basics. The technical base uses Minervini's Trend Template, a list made to sort for stocks with better price strength and agreement along important moving averages. This is combined with a filter for high growth momentum (HGM), which looks for firms with strong and frequently speeding trends in earnings, sales, and profit margins. The aim is to locate securities where outstanding technical condition is backed by solid and getting better core business results, a pairing that has come before major price gains.
A Standard Technical Arrangement
From a technical view, PAN AMERICAN SILVER CORP (NYSE:PAAS) shows a convincing image that matches the Minervini Trend Template closely. The template's goal is to make sure an investor only looks at stocks in a strong, verified uptrend, therefore trading with the existing momentum.
A check of the main conditions shows PAAS fits these strict technical requirements:
- Price Above Key Averages: The stock's present price trades clearly above its 150-day and 200-day simple moving averages (SMAs). This is a main sign of a good long-term upward trend.
- Rising Long-Term Averages: Both the 150-day and 200-day SMAs have an upward slope, verifying the long-term trend is rising and building force.
- Positive Moving Average Order: The shorter 50-day SMA is positioned above both the 150-day and 200-day SMAs. This ordered arrangement (50 > 150 > 200) is a standard signal of speeding momentum and is a key part of the Trend Template.
- Nearness to Highs: The stock is trading within 25% of its 52-week high, showing it is a market leader with strength instead of bouncing back from large drops. Actually, it is currently attempting new high levels.
- Better Relative Strength: With a ChartMill Relative Strength (CRS) score of 97.87, PAAS is doing better than almost 98% of all stocks in the market over the last year. Minervini notes that the largest gainers usually show high relative strength early in their rises.
This technical arrangement points to institutional buying and a clear lack of major supply above, letting the easiest direction be upward.
Basics Driving the Momentum
The technical move upward is not happening alone; it is backed by a sharp gain in the company's fundamental picture, which makes it fit for high-growth momentum filtering. The High Growth Momentum (HGM) score checks the speed and quality of earnings and sales growth, and PAAS displays several very strong traits:
- Very Strong Earnings Growth: The company has moved from times of decrease to providing very large year-over-year earnings growth. Recent quarterly EPS growth numbers have been unusually solid, and the full-year trend shows a notable rebound.
- Positive Earnings Surprises: PAAS has exceeded analyst EPS forecasts in three of the last four quarters, with an average beat of almost 40%. These positive surprises often work as triggers, pulling more institutional attention and leading to price reassessments.
- Solid Sales Growth: Top-line growth is also solid, with recent quarterly sales rising greatly year-over-year. This shows that earnings growth is coming from growing business action, not only cost reduction.
- Gaining Profitability: Maybe most importantly, the company's profit margin has shown step-by-step gain in recent quarters. Growing margins suggest pricing ability, operational effectiveness, and a better quality of earnings, important features Minervini seeks in "superperformance" stocks.
- Analyst Positive View: The trend in fundamental momentum is being seen, as shown by upward changes to both next-year earnings and sales forecasts by analysts over the past three months.
This pairing of strong, speeding basics supplies the "fuel" for the technical "rocket." In the Minervini structure, solid earnings and sales growth are the triggers that can push a stock in a verified uptrend to make its largest price jumps.
Technical Condition Summary
The given technical study report gives a numbered summary of PAAS's chart condition. The stock gets a complete Technical Rating of 10/10, showing unusual strength across all checked periods. The report mentions the positive long and short-term trends, the stock's leading place by doing better than 97% of the market, and its recent move to new 52-week highs on higher-than-normal volume.
However, the report also gives an important note for possible investors: while the technical rating is very good, the present Setup Quality rating is poor (2/10). This shows the stock might be "stretched" in the short term, having climbed quickly without a notable pause. For traders following strict entry rules, this hints at waiting for a drop or a time of reduced movement to form a new foundation before thinking about an entry, which would give a better risk/reward arrangement. A complete list of all support levels and trend study can be seen in the full technical report for PAAS.
Locating Comparable Chances
PAN AMERICAN SILVER CORP works as a clear example of a security that meets both a strict trend-following template and filters for high-growth momentum. For investors trying to use this joined method to find other possible choices, the filtering process that found PAAS is a sensible first step.
You can locate more stocks that fit these joined conditions of the Minervini Trend Template and High Growth Momentum by using this set filter: High Growth Momentum + Trend Template Screen.
Disclaimer: This article is for information and learning only. It is not advice to buy or sell any security. The study uses given data and past performance, which does not show future outcomes. Always do your own research and think about talking with a qualified financial advisor before making any investment choices. Please read our full disclaimer here.
