Why Cia Saneamento Basico de-ADR (NYSE:SBS) Stands Out for CANSLIM Investors

Cia Saneamento Basico de-ADR (NYSE:SBS) surfaced in our CANSLIM stock screen, meeting several key criteria of William O’Neil’s growth investing strategy. The company, a water and sewage service provider in Brazil, demonstrates strong earnings momentum, solid profitability, and favorable technical trends. Below, we examine why SBS aligns with the CANSLIM approach.

Key CANSLIM Criteria Met by SBS

• Earnings Growth (C & A):

  • Quarterly EPS growth (Q2Q) of 80.8%, well above the 20% minimum threshold.
  • Revenue growth (Q2Q) of 28.6%, exceeding the 25% benchmark.
  • Three-year EPS CAGR of 60.8%, far surpassing the 25% requirement.

• Profitability (A):

  • Return on Equity (ROE) of 26.7%, indicating efficient capital use.
  • Strong margins, including an operating margin of 43.8%, placing it among industry leaders.

• Relative Strength (L):

  • A ChartMill Relative Strength score of 92.8, meaning it outperforms nearly 93% of stocks.
  • Both short- and long-term trends are positive, reinforcing its leadership position.

• Institutional Sponsorship (I):

  • Institutional ownership stands at 45.3%, below the 85% upper limit, suggesting room for further institutional interest.

• Debt Management (S):

  • A conservative debt-to-equity ratio of 0.65, well below the 2.0 threshold.

Technical Strength

The stock is trading near its 52-week high, with a strong upward trend supported by rising moving averages. Recent consolidation near resistance at $20.99 could present a potential breakout opportunity.

For a deeper look, review the full technical analysis report and fundamental analysis report.

Our CANSLIM High Growth screener lists more high-growth candidates updated daily.

Disclaimer

This is not investment advice. The observations here reflect conditions at the time of writing. Always conduct your own research before making investment decisions.