HO.FR: Long positions opportunity with trend

Stock offer /Thales Group S.A./ Our expectations:

Thales is one of the largest suppliers of Boeing and Airbus for aircraft equipment. The company operates in the defense sector aerospace and transport by offering different types of aircraft equipment, in-flight entertainment devices, satellite and space systems, also and radar equipment for flight management.

On the graph below, we see the comparison between Thales S.A. and the Aerospace and Defense Index, making it clear that the share is cheap in the sector at the moment:

In financial aspect, company is doing well, comparing debt and revenue, making it clear that as of 2010, the company's debt has fallen smoothly while sales revenue is rising. As a percentage, debt is only 10% of revenue:

One of the most important financial indicators, EPS, investors has been growing over the years, with projections for the next one year rising by 45%:

Given the financial data and the fundamentals around the sector, our expectations are that the price will continue to rise.

Technical Analysis: The price is in the long-term upward trend, after retracement to a horizontal, diagonal and dynamic support level. Correction to 23.6% of Fibonacci and rebound - positive for the price. Breakthrough of a short diagonal with upward Gap- a strong positive signal. 50 over 200SMA - positive for the price. Sequential started a new count after the support test and the CCI (50) crossed zero from the bottom up - a strong signal for a new upward wave.

From the graph below, it is clear that when the diagonal volume breaks are exceeded above the average for the share, which in support of the beating movement:

Alternative Scenario: If the price returns under diagonal support and stays for several bars there, the positive scenario will be spoiled and more likely to see a decline in the asset's cost.

SL: 90.43

Graphics: Bloomberg Pro Terminal

Jr Trader Petar Milanov

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