Trade Alert: After The Shooting Stops
A bullish bet on another company positioned to profit from repairing Persian Gulf energy infrastructure. Plus, a bullish trade in space/defense.
After The Shooting Stops
Today’s alert includes a trade on a name from Friday night’s Portfolio Armor Top Ten, plus one on a name from one of my Chartmill screens. Both are repeat trades. One is a name that was a big winner for us earlier this year, and one is a name where our previous trade is still underwater. But both pass the same screens we use to avoid chasing overextended stocks and trying to catch falling knives: both have RSIs between 40 and 60, both have Chartmill Setup scores of at least 6, and both have overall bullish technical ratings.
The difference is why we’re reentering them. The previous winner also has strong fundamentals, including a Piotroski F-score of 9 and a Chartmill fundamental rating of 7. The underwater name, meanwhile, is back in Portfolio Armor’s Top Names and just landed a major contract that helps validate its business model. So in both cases, I think the setup justifies another look.
Why We’re Reentering Two Familiar Names
The previous winner is also positioned to benefit from a dynamic that has become more important as this war has dragged on: eventually, damaged Persian Gulf energy infrastructure is going to have to be repaired and restarted, and this company is well placed to profit from that. The other repeat name has a different appeal. Even though our earlier trade on it is underwater, it is back in the Top Names, its technical setup remains constructive, and the new contract win is the kind of outside validation we like to see when we’re deciding whether to give a name another shot.
Today’s First Top Names Trade
Space / defense launch theme
