Company News Update

[Boon]

good method looking at 52 week low stocks. this fits in with the old adage of "buy low and sell high"

Usually i like to buy when they have bounced a bit from their 52 week lows and on the way up. Usually this signifies management has managed to do some sort of significant turnaround in the business or that the prospects in the particular industry/sector are improving significantly. Whilst this may not provide the maximum gain, it does mean that the chance of the undervalued stock having further gains is very likely. And if the balance sheet is strong with lots of cash, very limited downside. This also shortens the time needed to hold a value stock before seeing some capital gains as opposed to just buying at lows and waiting 2-3 years or more for the industry cycle to recover.

I reckon if you look at 52 week lows there would be a lot of OnG and shipping stocks and probably some property ones in the bunch.

Is a stock at (or near) its 52-week low necessarily cheap or undervalued?
 
Could a stock, at 52-week low, keep on making new (and even lower) 52-week lows?
 
For stocks that have bounced a bit from their 52 weeks low – how do you recognize those that would keep moving up from there?
  
OTOH, is a stock at (or near) its 52-week high necessarily expensive or overvalued?
 
Could a stock, at 52-week high, keep on making (and even higher) 52-week highs?
 
What is so magical about the “52-week”?
 
Is it because, conveniently, a stock's 52-week highs and lows data are so readily available?
 
Why not 104-week, 156-week, 260-week or 26-week or …….?
 
What difference would it make to your stock selection?
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