In our Equity Advisor issue last February 28, 2016, we noted that Trans-Asia Oil and Development Corporation (TA) would start to establish an uptrend following its break from both its downtrend resistance and from a bullish reversal. Since then, one can see that the stock had indeed risen, reached, and even surpassed its initial goal of Php2.60, giving it a gain of at least 15.55% inside 11 trading days. Since reaching a high of Php2.95, though, the stock has been in an interim corrective mode. While the stock has been quiet once again for about 2 months now, we firmly believe that its general bias remains on the upside. Technically, its uptrend on a bigger time frame is still intact. Note that a break from its present near term downward channel may send it back to its Php2.80 to Php2.90 resistance. Fundamentally, consensus likewise give TA a fundamental fair value estimate of Php2.88.
TA write-up from the Trading Edge Equity Advisor:
February 28, 2016
A solid combination of fundamental catalysts plus a technical price should easily support the rise in Trans-Asia Oil and Energy Development Corporation (TA). First, the company has reported a consolidated net income of Php905.80 million in 2015, which was a 403% surge from its 2014 income of just Php180 million. Note that the company has also declared a cash dividend of Php0.04/share. Technically, TA has also breached a downward sloping resistance line that has kept it in check for more than a year. With its rise over the Php2.14 resistance, TA may now be able to freely move higher until it encounters another hurdle at Php2.60.
*Consensus target price or average target price given by the major foreign and local brokers of various stocks on top of index names are available in our Equity Advisor!
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