Avantor Stock Has Strong Technical Momentum, But Make Sure Your Stop Losses Are Tight

• Avantor (AVTR) exhibits strong technical momentum, recently setting a new year-to-date high.
• Shares are up more than 22% over the past year.
• AVTR maintains a 100% “Buy” technical opinion from Barchart.
• Most analysts see AVTR as undervalued, but I recommend a tight stop loss given its volatility and only moderate fundamental outlook.

Today’s Featured Stock

Valued at $10.44 billion, Avantor (AVTR) is a provider of critical products and services primarily to the biopharma, healthcare, education, government, advanced technologies, and applied materials industries. 

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals and superior current momentum. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. AVTR checks those boxes. The Trend Seeker issued a new “Buy” signal on May 27. The stock has gained 84.94% since that signal.

Barchart’s Indicators for Avantor

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Avantor scored a year-to-date high of $15.72 on Sept. 16.

• Avantor has a Weighted Alpha of 56.10.
• AVTR has a 100% “Buy” opinion from Barchart.
• The stock has gained 22.15% over the past 52 weeks.
• Avantor has its Trend Seeker “Buy” signal intact.
• The stock recently traded at $15.61 with a 50-day moving average of $13.31.
• AVTR had 13 highs and gained 13.65% in the last month.
• 60-month beta of 0.89.
• Relative Strength Index (RSI) is at 69.66.
• There’s a technical support level around $15.20.

Don’t Forget the Fundamentals

• $10.44 billion market capitalization.
• 18.49x trailing price-earnings ratio.
• Revenue is projected to grow 0.63% this year and another 2.36% next year.
• Earnings are estimated to decrease by 9.65% this year but increase by 8.40% next year.

Analyst and Investor Sentiment on Avantor

• The Wall Street analysts followed by Barchart give the stock 3 “Strong Buy,” 14 “Hold,” and 1 “Strong Sell” opinions with price targets from $12 to $19.
• Value Line rates the stock “Highest” with price targets of $14 to $21.
• Morningstar thinks the stock is 26% undervalued with a fair value of $20.57.
• CFRA’s MarketScope rates the stock as “Hold” with a price target of $16.
• 4,500 investors are following the stock on Seeking Alpha, which rates it a “Hold.”
• TipRanks’ analysts’ price targets are between $11 and $16.
• Short interest is 7.42% of the float with 8.66 days to cover the float.

The Bottom Line on Avantor

The revenue and earnings projections are nothing to write home about, but most analysts think the stock is still undervalued. I’m not seeing what they're seeing, but I try not to spit in the wind. Morningstar thinks the stock has 26% still to go but I’d still keep a tight stop loss in place.

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculate should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.

On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.