Today we are going to look at Affiliated Managers Group Inc (AMG) to see if their stock is one you should get to know. It has come down from its highs in the $200s and is now in the lower $100s. We will look at the 7 fundamental parameters I look to see if a stock can be considered a growth stock. Then we will take a look at the technical analysis side using the setups I have created and use for my trades. I have no plans to own AMG in the next 72 hours and do not hold any positions in Affiliated Managers Group (AMG).
Affiliated Managers Group Inc (AMG): Should You Get to Know This Stock?
There are 7 fundamental markers I look for in a stock. I try to only purchase growth stocks so these are the parameters I look for to see if a stock meets the majority of the markers. I prefer to have all seven fulfilled. You can it more in depth here: https://evancarthey.com/how-to-scan-for-winning-stocks-an-insiders-view-to-my-process/
- Market Cap: > $300 million
- EPS growth past 5 years: >0%
- P/E: Over 10
- EPS growth next 5 years: >0%
- Sales growth past 5 years: Over 20%
- Debt/Equity: <0.1
- Sales growth qtr over qtr: Over 5%
Does the stock meet these 7 markers?
- Market Cap: 5.83B (YES)
- EPS growth past 5 years: -6.60% (NO)
- P/E: 26.71 YES
- EPS growth next 5 years: 4.49% (YES)
- Sales growth past 5 years: 1.70% (NO)
- Debt/Equity: 0.53 (NO)
- Sales growth qtr over qtr: -6.60% (NO)
I used Finviz.com for the fundamental analysis screener. With Affiliated Managers Group hitting only 4 of the 7 markers it is not a growth stock. Affiliated Managers Group doesn’t have very good fundamentals for what I look for to see if a stock is a growth stock. These numbers are not very good so for me personally I would be avoided this stock. Their sales growth is terrible.
Before I would trade just about any stock that fit my technical parameters. Unfortunately, I have had to learn the hard way that the fundamentals of a stock are just as important (if not more) than the technical setups.
Technical Analysis of Affiliated Managers Group (AMG)
Using a new setup I discovered and am using in other trades AMG is currently in a long setup using the 50B trade setup. The pivot points are highlighted in yellow and you can see how price went through the orange line of 127.2% at $113.62 and bounced perfectly off the 161.8% level. When price hit the 127.2% Fibonacci extension level that initiated this trade setup.
The current exit is the pink line at around $140.39. If price continues to go lower and breaks past the pivot low of $88.47 then I would move the Fibonacci retracement lower with it which would update the exit. The exit is just below the 50% Fibonacci retracement level.
That is the only trade setup I see. All of the short setups have been completed due to the long-term downtrend AMG has been in. If price continues to go up then it will create new opportunities but right now that is the only one I see.
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