X FINANCIAL-ADR (NYSE:XYF) – A Strong Contender for CANSLIM Investors

X FINANCIAL-ADR (NYSE:XYF) has emerged as a notable candidate for investors following the CANSLIM strategy. The stock demonstrates strong earnings growth, solid profitability, and impressive relative strength, aligning well with the key principles of CANSLIM investing. Below, we examine why XYF stands out.

Why XYF Fits the CANSLIM Criteria

• Earnings Growth (C & A Criteria): XYF reported a 106.2% year-over-year EPS growth in its most recent quarter, far exceeding the CANSLIM minimum threshold of 20%. Revenue growth was also strong at 43.3%. Over the past three years, EPS has grown at an annualized rate of 28.9%, reinforcing consistent performance.
• Profitability (A Criteria): The company’s Return on Equity (ROE) of 22.1% is well above the 10% minimum suggested by CANSLIM, indicating efficient use of shareholder capital.
• Relative Strength (L Criteria): With a ChartMill Relative Strength score of 99.2, XYF outperforms nearly all stocks in the market, a key trait for CANSLIM leaders.
• Debt Management (S Criteria): A Debt/Equity ratio of 0.39 suggests a conservative balance sheet, reducing financial risk.
• Institutional Sponsorship (I Criteria): While institutional ownership is low at 2.0%, this could indicate room for increased institutional interest as the company grows.

Technical and Fundamental Highlights

• Technical Strength: XYF’s price trend is bullish in both the short and long term, trading near its 52-week high. The stock has surged 358.6% over the past year, reflecting strong momentum.
• Valuation: Despite rapid growth, XYF trades at a P/E ratio of 3.5, significantly below industry and S&P 500 averages, suggesting potential undervaluation.

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

Our CANSLIM High Growth screener lists more stocks meeting these criteria and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should conduct your own analysis before making investment decisions.