For investors looking for a systematic way to find possible market leaders, a combined plan that looks at earnings momentum, technical condition, and clear chart patterns can be a useful instrument. This technique brings together the ideas of high-growth momentum investing, which favors firms showing faster earnings and sales, with technical study that finds good entry points. By searching for stocks that rate well on a unique High Growth Momentum Rating, have a good Technical Rating, and display a high-grade Setup Rating, investors can sort for companies that are both improving fundamentally and set up technically for a possible price move.
SOUTHSTATE BANK CORP (NYSE:SSB) appears from such a search, presenting a noteworthy case for review. The regional bank, which provides consumer and commercial banking services across the Southeastern United States, is now showing a combination of positive fundamental momentum and helpful technical action.
Fundamental Growth Momentum
The center of the high-growth momentum method is finding companies with good and often speeding earnings power. SOUTHSTATE BANK CORP’s recent financial results show several positive signs that add to its firm High Growth Momentum Rating.
- Strong Earnings Growth: The company’s earnings per share (EPS) growth on a year-over-year quarterly basis has been notably good. The latest quarter saw EPS grow by 35.8% compared to the same period last year. This comes after earlier quarters of 28.5% and 36.1% growth, pointing to a continued time of major earnings increase.
- Notable Sales Speed Increase: Maybe more striking is the direction in revenue growth. Quarterly sales growth has sped up noticeably, from 7.3% three quarters ago to 56.2%, 51.8%, and most recently, 63.9%. This sequence of speeding up is a main idea of momentum investing, hinting at rising business activity.
- Steady Earnings Surprises: The company has topped analyst EPS estimates in each of the past four quarters, with an average surprise of 19.8%. This steady better-than-expected performance hints that management results may be surpassing market forecasts.
- Growing Profitability: The profit margin in the last reported quarter was 35.3%, up from 32.4% in the quarter before and showing a general return toward levels seen in past years. Growing margins on speeding sales is a strong mix for bottom-line growth.
While free cash flow has fallen over the past year, a point for investors to watch, the overall view from recent quarters is of a company going through a forceful rise in both top-line and bottom-line performance.
Technical Condition and Setup Grade
A good fundamental story is most useful when paired with a positive price direction and a clear entry point. According to the detailed technical report, SOUTHSTATE BANK CORP scores a 7 out of 10 for both its Technical Rating and its Setup Grade Rating.
- Positive Price Direction: The technical study notes that while the long-term direction is still neutral, the short-term direction is positive, with the stock "getting more and more appreciated by traders and investors." The stock is trading above important moving averages (20, 50, 100, and 200-day SMAs), which are all rising, confirming the positive near-term structure.
- Helpful Consolidation: The Setup Rating points out that prices have been consolidating recently. After a move higher, the stock has been trading in a range, which can form a base for the next possible step up. The report finds a clear support zone below the current price and notes very little immediate resistance above, bettering the risk/reward setup for a price move.
- Clear Trading Levels: The technical study gives specific levels for review, suggesting a possible entry point just above a set weekly resistance trendline at $99.35, with a stop-loss order placed below the nearby support zone. This puts numbers to the setup, allowing for systematic position sizing based on the set risk.
A Merging Chance
The importance of SOUTHSTATE BANK CORP’s current position is in the coming together of these two parts. The high-growth momentum standards explain why the stock might draw buyer attention, its speeding earnings and sales give a fundamental reason. The technical ratings explain when that attention might turn into a price move, the stock is in a good short-term upward direction and has made a consolidation pattern that gives a set entry and risk point.
This merging is exactly what the combined search method aims to find: companies with the fundamental engine to push performance, shown in a technical setting that gives a planned moment for investment review. It goes past just finding a sound company or a sound chart, trying instead to find sound companies at a sound point on their chart.
For investors wanting to look at other securities that meet this exact mix of high-growth momentum and technical price move setups, the search that found SOUTHSTATE BANK CORP can be reached directly: Find More High Growth Momentum Breakout Setups. This tool is updated often, giving a changing list of possible choices that fit this systematic investment plan.
Disclaimer: This article is for information only and does not make up financial advice, a suggestion, or an offer or request to buy or sell any securities. The study shown is based on data and ratings given by ChartMill and should not be the only base for any investment choice. Investing includes risk, including the possible loss of principal. Always do your own complete study and think about your personal financial position and risk tolerance before making any investment. The technical setup and trade example named are made automatically and for example only.
