Sodexo : Profit-taking can be expected to dominate
Entry price | Target | Stop-loss | Potential |
---|
€105.45 |
€100.8 |
€109 |
+4.41% |
---|
Sodexo shares can be expected to top out below the medium term resistance at 107.4 EUR. The timing appears attractive to take advantage of a correction below this level.
Summary● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
● In a short-term perspective, the company has interesting fundamentals.
Strengths● Considering the small differences between the analysts' various estimates, the group's business visibility is good.
● The company is one of the most undervalued, with an "enterprise value to sales" ratio at 0.72 for the 2020 fiscal year.
● Analysts have consistently raised their revenue expectations for the company, which provides good prospects for the current and next years in terms of revenue growth.
● The tendency within the weekly time frame is positive above the technical support level at 96.6 EUR
Weaknesses● Technically, the stock approaches a strong medium-term resistance at EUR 107.4.
● The company does not generate enough profits, which is an alarming weak point.
● Most analysts agree on a negative opinion with regard to the stock. Indeed, the average consensus issues recommendations to underperform or sell.
● The three month average target prices set by analysts do not offer high potential in comparison with the current prices.
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