Thursday, April 1, 2010

Riding the Wave of Positive Sentiment and Momentum

MomentumNewsSentiment  Are there different ways to show Momentum in a stock?  Consider the amount and quality of News Sentiment in a stock that is moving up. Best Buy (BBY) recently is leading all Retailers in the quality (top 4) and quantity (number 1) of News Sentiment on a 1 week moving average (BBY is near the top of retailers in News Sentiment on a 1 month Moving Average-not pictured).  Notice in the large market view (Above: News Sentiment-All Industry Groups) that BBY, has one of the highest positive sentiment scores for a company with a large volume of stories across the entire market (big green buildings in the lower left hand corner of each Industry Group)Is it too late to ride the wave of Positive Sentiment and Momentum?

Now compare the recent price movements to the rest of the Retail Industry Group ( Below: Ratio of Current Price to Price Performance and 6 Month Price Chart).

Ratio Current Price Performance 

Dark Green companies lead the Retail Industry group in trading above their 50 Day Moving Average.  Our Sort shows BBY is still in the top 3rd.  Also note that while the performance of BBY was positive over the last month, it does not stand out as getting ahead of itself. The Halo Effect of having iPads in Best Buy, while reported, has not yet been reflected in the stock price.  My take is that at 13x earnings there is room for BBY to run.

For a Sentiment Analysis of a Portfolio or Industry Group using AlphaVision, please contact Aqumin at

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