[12 July 2024]
Today, Friday 12 July 2024, StockCharts365.com has taken a closer look at Elkem ASA (ticker on the Oslo Stock Exchange: ELK).
The company presented results for the 2nd quarter of 2024 early today, and these have been well received in the market today.
The technical picture for the share now triggers a buy signal for the share, and after a longer period of consolidation.
The potential can be significantly higher than today's share price in both the short and medium term.
Read more about this below in the case here under today's technical analysis of Elkem ASA (ticker on Oslo Børs: ELK).
First a little about the company Elkem ASA (ticker on the Oslo Stock Exchange: ELK)
Elkem is one of the world's leading providers of advanced silicon-based
materials shaping a better and more sustainable future.
The company develops silicones, silicon products and carbon solutions by combining natural raw materials, renewable energy and human ingenuity.
Elkem helps its customers create and improve essential innovations like electric mobility, digital communications, health and personal care as well as smarter and more sustainable cities.
Elkem sells its silicon-based material to a vide range of different markets with strong growth prospects, such as renewable energy markets, electrical vehicles, healthcare and construction.
With a strong track record since 1904, its global team of more than 7,400 people has a joint commitment to stakeholders: Delivering your potential.
In 2023, Elkem achieved an operating income of NOK 35.5 billion and CDP ratings
of A on Forests, and A- on Climate Change and Water Security.
Elkem is listed on the Oslo Stock Exchange (ticker: ELK), where the company is also included in the ESG Index.
For more information about the company, visit their website here:
Second quarter 2024 - Profitability improvements driven by enhanced operating performance
I dag kl. 07:00 ∙ Source: Oslo Børs - Oslo, 12 July 2024
Elkem reported an EBITDA of NOK 1,030 million in the second quarter 2024. This is in line with the corresponding quarter last year, and an improvement compared to the preceding three quarters.
"Improved profitability was primarily driven by a strong operational performance
as part of Elkem's comprehensive improvement programme. Market conditions have remained challenging in the quarter," says Elkem CEO Helge Aasen.
Elkem's total operating income for the second quarter 2024 was NOK 8,490 million, which was down 6% compared to the second quarter 2023, but up from the preceding quarters. Earnings before interest, taxes, depreciation and amortisation (EBITDA) was NOK 1,030 million, which was in line with the corresponding quarter last year, and an improvement compared to the preceding three quarters. Earnings per share (EPS) was NOK 1.35 in the quarter, and NOK 0.65 year-to-date.
The group's equity as at 30 June 2024 amounted to NOK 25,351 million, which gave
a ratio of equity to total assets of 51%. Net interest-bearing debt was NOK 10,333 million, which gave a ratio of net interest-bearing debt to EBITDA of 3.5x, unchanged from last quarter. Elkem had cash and cash equivalents of NOK 5,442 million as at 30 June 2024, and undrawn credit lines of more than NOK
6,000 million.
Technical Analysis of Elkem ASA (ticker on Oslo Stock Exchange: ELK)
Charts are from the technical analysis program Vikingen.
Technical Analysis of Elkem ASA (ticker on Oslo Stock Exchange: ELK):
Elkem today triggers a strong technical buy signal after a longer period of consolidation within a large symmetrical triangle formation (cf. daily chart).
The stock has also recently broken above both the 50-day and 200-day moving averages, and the 50-day moving average has broken above the 200-day moving average.
This also signals that both the short- and medium-term trend for the share has turned positive.
The rise today (and after the Q2-2024 results presentation this morning) is happening on high volume. This further contributes to and reinforces the technical buy signal that is currently triggered for the Elkem share.
StockCharts365.com's own analysis model has also recently triggered a buy signal for Elkem, and thus indicates further growth for the share in both the short and medium term.
In addition, various momentum indicators such as RSI, Stochastics and MACD are now signaling a further rise for the share in the short term.
The overall technical picture for the Elkem share is now very positive, and further growth is signaled for the share in the short and medium term.
The next technical resistance level of importance for the share is now around NOK 28.00, and if the share breaks through that level, further price increases for the share to around NOK 38.00 will be signalled.
Based on this now overall very positive technical picture that the Elkem share shows, StockCharts365.com considers the share a very interesting buy candidate at today's price level.
The potential in the very short term (1-3 weeks is assessed to be around NOK 28.00), and in the medium term (3-6 months) the potential for the share is assessed to be around NOK 38.00.
What could potentially change the now very positive technical picture for the Elkem share would be if the share were to fall back and end up below the 50-day and 200-day moving averages, which are currently around the NOK 20.00 level.
The Risk-Reward Ratio is therefore considered to be very positive now for the Elkem share, and which StockCharts365.com believes may have a potential of around NOK 38.00 in the 3-6 month term, and a stop-loss can be set if it breaks below NOK 20.00 - level.
The share is traded today, around 12 noon Norwegian time on Friday 12 July 2024, at around NOK 22.50.
NB! Remember to have read and understood the disclaimer.
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