Founded in 1964 and headquartered in Cincinnati, Ohio, Hillman Solutions Corp. is an American hardware manufacturing, distribution, and consumer fabrication services company.
Its products include fasteners and related hardware items, threaded rod and metal shapes, keys, key duplication systems and accessories, builder's hardware and personal protective equipment, such as gloves and eyewear. Hillman's customers include home improvement centres, mass merchants, national and regional hardware stores, pet supply stores, and OEM & industrial customers.
Technically, a price that exhibits sequenced repetitive cycles, makes for an attractive investment opportunity (see the three dotted trendlines that are the same in length). The pattern is formed when the price oscillates between highs and lows or follows a specific trend (an uptrend in this instance).
According to the Relative Strength Index (RSI), the stock will be in overbought territory at ~$12. This classifies our profit target of $10 as realistic.
We suggest a low at-risk allocation for this trade.
Share Information
| Share code | HLMN |
|---|---|
| Industry | Capital Goods |
| Market Capital (USD) | 1.57 billion |
| One year total return | -31.00% |
| Return year-to-date | 12.07% |
| Current price(USD) | 8.08 |
| 52 weeek high(USD) | 12.45 |
| 52 week low(USD) | 6.60 |
| Financial year end | December |
| Closing paragraph | The current price provides a decent entry point. The share is trading at a beta of 0.98, indicating that the share is slightly less volatile than the overall market. We expect medium to high fluctuations in the share price. |
Consensus Expectations (Bloomberg)
| FY22 | FY23E | FY24E | FY25E | |
|---|---|---|---|---|
| Headline Earnings per Share (USD) | 0.43 | 0.37 | 0.45 | 0.51 |
| Growth (%) | -13.95 | 20.54 | 14.35 | |
| Dividend Per Share (USD) | 0 | 0 | 0 | 0 |
| Growth (%) | - | - | - | |
| Forward PE (times) | 21.84 | 18.12 | 15.84 | |
| Forward Dividend Yield (%) | - | - | - | |
| Closing paragraph | While earnings are expected to be softer in FY23, a decent recovery is anticipated thereafter. Several technical indicators point to upside potential in the price. | |||
Buy/Sell Rationale
Technical Analysis:
Long-term fundamental view:
| Share Name and position |
PEP - Profit Take (Close the position) |
MSFT - Profit Take (Close the position) |
MA - Profit Take (Close the position) |
|---|---|---|---|
| Entry | 178.01 | 276.20 | 354.44 |
| Current | 193.38 | 305.41 | 376.12 |
| Movement | 8.6% | 10.6% | 6.1% |
| Summary text | The price reached our profit target, and we closed the position. | We closed the position for an early profit take to reduce the overall portfolio exposure. | We closed the position for an early profit take to reduce the overall portfolio exposure. |
| Share Name and position |
KO - Buy (Continue to Hold) |
COST - Profit Take (Close the position) |
STZ - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 61.85 | 501.27 | 228.16 |
| Current | 63.72 | 490.34 | 222.41 |
| Movement | 3% | -2.2% | -2.5% |
| Summary text |
A symmetric triangle pattern remains of interest. Remains above its 200-day simple moving average.
Our profit target remains at $67, with a trailing stop-loss at $61.85. Time exit: 16 June 2023. |
Technical indicators are supportive of a bullish trend. Testing its 200-day simple moving average.
Our take profit target remains at $560 with a stop-loss at $480. Time exit: 7 July 2023. |
A bullish megaphone pattern remains of interest. The stock remains below its 200-day simple moving average but is moving closer to it.
Our take profit target remains at $252 with a stop-loss at $218. Time exit: 21 June 2023 |
