Our first idea today is a medical device company who recently saw coverage of its shares initiated at Roth Capital with a ‘Buy’ rating. Our second recommendation is a short sale of a stock that is facing increasing competition.
Special Situation Buy: InMode Ltd. (INMD)
From Shortex Market Letter
InMode Ltd. (INMD)
52wk H. 58.78 52wk L. 13.06
Mkt Cap: $1.24B, EPS 1.16, P/E: 36.25
The medical aesthetics company. A hallmark in plastic surgery: expects Q4-’19 earnings of $1.76/shr vs. $1.55/shr a year ago. Price of INMD has rocketed 190% since its IPO in August ’19. Carries a forward P/E of 28. Technical picture since its IPO has been ascending above its 50-DMA: (17-20) to (20-22) to (24-27). Gapping up (30-36) to (40-43). Correction/retraction completed after topping at (55-58). Reversal has challenged primary resistance (39-41). Secondary resistance at (47-52) and upper-head resistance at (56-58).
BUYING RANGE: 37-47
NR TERM OBJ: 55
INTERMED OBJ: 69
STOP LOSS: 32
Joseph Parnes, Shortex Market Letter, www.shortex.com, 800-877-6555, January 16, 2020