The GBp 2205 support, currently tested, should allow Derwent London to rally again.

The stock is undervalued with a P/E ratio estimated at 10.7x for 2013. Besides, EPS estimates have regularly been revised upward by the Thomson Reuters consensus.

Technically, the security fell sharply for several days and is now back to an opportune buying point. Indeed, prices are near the GBp 2205 support, corresponding to a bullish trend line. During the yesterday' session (12 June) investors were very hesitant and buyers may take the upper hand in the coming trading sessions thanks to the fundamental and technical configuration. The objective will be a comeback to the 50-day moving average around GBp 2350.

Thus, active investors can take a long position at the current price. The downside potential is limited and the timing seems perfect to benefit from a technical rebound. The goals will be fixed at GBp 2350 in a first time and then at GBp 2542. However, a bearish trend would regain the upper hand if the security crosses GBp 2205.