On Wednesday, Shift4 Payments earned a positive adjustment to its Relative Strength (RS) Rating, from 90 to 93.
When looking for the best stocks to buy and watch, keep a close on eye on relative price strength. IBD's proprietary rating identifies market leadership with a 1 (worst) to 99 (best) score. The rating shows how a stock's price performance over the trailing 52 weeks stacks up against all the other stocks in our database.
Decades of market research shows that the stocks that go on to make the biggest gains tend to have an RS Rating north of 80 at the beginning of a new run.
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Shift4 Payments is now considered out of buy range after clearing a 51.52 buy point in a first-stage consolidation. With the recent market downturn, it has given back much of its gains. If you had it, hopefully you sold some into strength.
Now we watch to see if the stock, ideally, forms a new pattern. Perhaps a follow-on buying opportunity like a three-weeks tight as it tries to regain some key moving averages before the next earnings release (read on).
Earnings Preview
Earnings grew 69% last quarter, up from 43% in the prior report. Revenue also increased, from 44% to 45%. The company is expected to report its latest earnings and sales numbers on or around Feb. 28.
The company earns the No. 3 rank among its peers in the Finance-Card/Payment Processing industry group. Cass Info Systems and WEX Inc. are among the top 5 highly rated stocks within the group.
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