Chart of the Day: Has Axon Fallen to a Buy Point?
The stock has been hard hit since reporting strong earnings last month.
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It's difficult to believe the poor action from Axon Enterprise AXON after the company delivered quality earnings and revenue along with decent forward guidance. Of course, the company has been beating estimates for the last few quarters and at some point it was going to catch up. Meaning, the investment community would soon believe the stock was 'fairly valued'.
But, we always look to the technicals for clues as to where a nice entry point might be located. The recent drop has come down to an area where big buyers stepped in to buy the stock back in late February (last earnings report). Is that meaningful? It could be if the stock can settle down here, build a base and show that the big institutions are interested once again.
For now, the indicators are bearish and reflect the poor sentiment and price action. MACD (moving average convergence divergence) is on a sell signal while money flow is bearish and shows lower highs, lower lows.
Clearly Axon needs to prove itself and do more work, but if this area between $280-$290 holds it may present a nice entry point to add shares. Earlier today, we purchased 88 shares of Axon at or near $285.50 and the shares now account for about 3.75% of the portfolio.
We rate Axon Enterprise a one in TheStreet Pro portfolio, which means buy at anytime.
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At the time of publication, TheStreet Pro Portfolio was long AXON.
