Q: It's at a 30 year high it seems like, it is hitting the upward end of analysts price targets and there is recent insider selling by the CFO. Should I just take my profits and buy lower? or is there a better stock to buy in the sector? And if there is what's a good price to get in on your "better stock"?
Thank you
Thank you
5i Research Answer:
We tend to see new highs and momentum as positive factors, not negative. Putting oneself in the buyers' shoes can be helpful. Buyers today are not buying with the expectation to lose money so what are they seeing? We consider it one of the best for the sector, certainly. It is well-managed and well-financed. Now that it is $14B market cap, more investors/funds can buy it. It is not cheap at 20X earnings, certainly, and a recession or low commodity prices would bring it down, but that would be the same for any stock in the sector. We would manage position size after its big gains but would not consider it a sell.