Oaktree Specialty Lending (OCSL) is on the move, here’s why the trend could be lasting
OWhen it comes to investing or trading in the short term, they say “the trend is your friend”. And it is undeniably the most profitable strategy. But ensuring that a trend will continue to profit from it is easier said than done.
The trend often reverses before exiting the trade, resulting in a short-term capital loss for investors. Thus, for a profitable trade, one must confirm factors such as strong fundamentals, positive revisions in earnings estimates, etc. which could maintain the momentum of the title.
Our “Recent Price Strength” screen, which is created on a unique short-term trading strategy, could be very helpful in this regard. This predefined screen makes it easy to preselect stocks that have enough fundamental strength to maintain their recent uptrend. Additionally, the screen only passes stocks that are trading at the upper end of their 52-week high-low range, which is usually a bullish trend indicator.
Oaktree Specialty Loans (OCSL) is one of many suitable candidates that have come across the screen. Here are the main reasons why it could be a profitable bet for “trendy” investors.
A solid price increase over a 12-week period reflects investors’ continued willingness to pay more for a stock’s potential upside. OCSL is quite well suited in this regard, gaining 4.3% over this period.
However, just looking at the price action for about three months is not enough, as it does not reflect any trend reversals that might have happened in a shorter time frame. It is important for a potential winner to maintain the price trend. A price increase of 0.1% over the past four weeks ensures that the trend is still in place for the title of this specialized financial company.
Additionally, OCSL is currently trading at 92.6% of its 52-week high-low range, hinting that it may be on the verge of a breakout.
In terms of fundamentals, the stock currently carries a Zacks Rank #2 (Buy), meaning it’s in the top 20% of over 4,000 stocks we rank based on revision trends. earnings estimates and EPS surprises – the key factors that affect a stock’s short-term price movements.
The Zacks Rank stock rating system, which uses four factors tied to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive track record. externally audited record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the full list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>
Another factor that confirms the fundamental strength of the company is its average broker recommendation of #1 (Strong Buy). This indicates that the trading community is very optimistic about the short-term price performance of the stock.
So, the price trend in OCSL might not reverse any time soon.
In addition to OCSL, there are several other stocks currently running through our “Recent Price Strength” screen. You can consider investing there and start looking for the newest stocks that meet these criteria.
It’s not the only screen that could help you find your next winning stock pick. Depending on your personal investing style, you can choose from over 45 Zacks Premium screens that are strategically created to beat the market.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.