Upside For Beach Energy

This story features BEACH ENERGY LIMITED. For more info SHARE ANALYSIS: BPT

By Michael Gable 

The Australian market continues to trade in a range, mainly pushed around by the banks. As mentioned in last Tuesday's report, and then again in Saturday's Fairfax newspapers where our views were quoted by a journalist, we need to be mindful of this triangular trading range. When the market breaks out of it, a large move normally follows. Beach Energy ((BPT)) looks particularly interesting here at the moment, so take a look at that chart.

We were also going to bring you some further analysis on Programmed Maintenance Services (PRG). After including the chart in last week's report, and noting how close it was to breaking higher, we decided to spend some more time looking at the fundamentals. Unfortunately, a couple of days later it received a takeover bid, at a price more than 60% above where it last traded. Hopefully someone grabbed it anyway off the back of last week's report but we have to admit to not buying it yet – and now its too late. You can't win them all, but you have to be in the game to have a chance. Better luck next time.
 

The chart for BPT is a textbook example of a stock finding a low and preparing to rally. Firstly, we can see that the stock rallied from about 50c to 90c during September to December last year. The stock needed 3 months to rally 40c, but then in twice that period of time (6 months), it could only dip back to the mid 50c region. So, from a timing point of view, the fact that the stock needed a longer period of time to retest the low and then hold it, is a positive sign. Then in the last couple of weeks, BPT has made a higher high and higher low, with yesterday's move looking particularly bullish. If BPT comes back a few cents here, then that would be a buying opportunity with an initial upside target near 70c.

Content included in this article is not by association the view of FNArena (see our disclaimer).
 
Michael Gable is managing Director of  Fairmont Equities (www.fairmontequities.com)

Fairmont Equities is a share advisory firm assisting Private Clients with the professional management of their share portfolio. We are based in the Sydney CBD but provide services to private clients across Australia. We believe that the concepts of fundamental analysis and technical analysis of stocks are not mutually exclusive. Regardless of whether you are a trader or long term investor, combining both methods is crucial to success. As a result, the unique analysis of Fairmont Equities is featured regularly in the media such as Sky News Business, CNBC, The Australian Financial Review, and the ASX newsletter. Contact us for a free trial of our research and information on our portfolio management services. 

Michael is RG146 Accredited and holds the following formal qualifications:

• Bachelor of Engineering, Hons. (University of Sydney) 
• Bachelor of Commerce (University of Sydney) 
• Diploma of Mortgage Lending (Finsia) 
• Diploma of Financial Services [Financial Planning] (Finsia) 
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2

Disclaimer

Fairmont Equities Australia (ACN 615 592 802) is a holder of an Australian Financial Services License (No. 494022). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.
 

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