The industrial giant's stock price could rise again
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Our Equity Top Pick List
We have updated our Equity Top Pick List to reflect the events of the past quarter. The list includes those stocks, typically US and European ones, that we consider to be proper investment choices from a fundamental point of view. It can provide a starting point for building a sector-diversified equity exposure in portfolios, but can also be used as a watch list. Technical analysis should be used to time / determine the specific investment decision.
Could the momentum return in the semiconductors?
The semiconductor sector has had a challenging quarter, with its performance in recent months lagging behind improvements in underlying fundamentals, even as AI-driven demand remained exceptionally strong. The accelerating adoption of AI by enterprises and the proliferation of AI agents are significantly increasing the demand for computing capacity, which points to a further surge in cloud services and data center investments. Given current supply constraints, record-high backlogs, and higher-than-expected investment needs, we expect further upward revisions to earnings forecasts in the semiconductor industry. Nevertheless, the sector’s valuation appears favorable from a historical perspective, which, in our view, could result in a more attractive risk-return profile in the coming months.
European markets also began to fall due to widespread profit-taking. For this reason, the model didn’t offer many opportunities. However, there is a Swiss company—one of the world’s largest manufacturers of flavors and fragrances—that gave a buy signal yesterday. Givaudan is an industry giant responsible for the flavors and fragrances we use every day (soft drinks, chocolate, perfume, shower gel, etc.), though we don’t see its name on the products. Its stock price reacted to upgrades, and the stock could turn around technically as well.
Best rated European stocks based on momentum ranking
Compelling technical picture:
Givaudan SA (daily): The long-standing downtrend has been broken, and with a gap at that. This could be a very good sign, provided it doesn’t retest the level within two days and stays above it. A sustained uptrend could begin, in which case it’s advisable to manage risk at the thick green trendline. The target price can be set around 3,750, given the gap left behind during the previous decline. Buying on dips may be recommended.
List of stocks with a chance of a turnaround in the coming weeks
Most popular European stocks
The momentum model supports the creation of a technical based stock list that helps to find shorter-term trading opportunities. The model can be used to identify stocks that show reversal signals following more sustained falls/underperformance. We examine one-year, six-month, three-month, one-month and five-day momentum values, which are used to rank the stocks under consideration. The higher a stock is ranked in the order, the better it technically performs relative to the others. The change in the ranking over time is used to determine the life cycle of the stock.
- In the first table, we collect the stocks that show the most attractive picture compared to the others in a given week based on momentum factors, of which those are also presented in a separate chart where a favourable situation can be identified based on additional technical analysis tools.
- In the second table, we list the stocks that are already worthy of being placed in watchlist status. They are not among the best performers, but they have the potential to improve and signal a turnaround in a few days or weeks.
- In the third table, we have also collected the more popular stocks to help identify their position in the momentum order.
The report shows the results of a technical - quantitative based stock screening, which does not examine the fundamental background/value of the companies. For this reason, risk management/position sizing rules should be designed accordingly.
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