The stock market has plenty of stocks rising, but only a select few combine strong technical uptrends with accelerating fundamentals. To identify these potential leaders, investors often rely on systematic frameworks. The screen used to find this candidate applies a dual filter: it first checks for Mark Minervini’s Trend Template criteria, a strict set of technical conditions that confirm a stock is in a strong, sustainable uptrend, and then overlays a High Growth Momentum (HGM) rating of at least 4. This ensures the stock not only looks good on a chart but also possesses the fundamental growth characteristics that historically precede outsized gains.
AAON INC (NASDAQ:AAON) has emerged from this screen as a potential candidate worthy of a closer look. The company, which engineers and manufactures air conditioning and heating equipment, including configurable HVAC systems and high-performance cooling solutions for data centers and cleanrooms, operates in the Building Products industry. Let’s break down why it fits the methodology.
Recent Performance and Technical Trend
The long-term trend for AAON is positive, while the short-term trend is currently neutral. This subtle divergence often occurs during consolidation phases after a strong run, which is precisely where the Minervini strategy looks for entry points.
The Trend Template requires a stock to be in a defined Stage 2 uptrend, and AAON checks every box:
- Moving Averages: The current price ($126.86) trades comfortably above the 150-day SMA ($100.23) and the 200-day SMA ($99.33). Both of these longer-term moving averages are rising, confirming sustained upward momentum.
- Moving Average Alignment: The 50-day SMA ($123.92) is above the 150-day SMA and the 200-day SMA. This bullish alignment is a core requirement of the template.
- 52-Week Range: The stock is currently trading within 25% of its 52-week high ($150.46) and sits more than 30% above its 52-week low ($62.00). In fact, at $126.86, it is more than double its low, a classic sign of strength.
The ChartMill Relative Strength rating of 92.84 is also critical. Minervini emphasizes that leading stocks must outperform the vast majority of the market. AAON’s score means it has outperformed roughly 93% of all stocks, and it also outperforms 97% of stocks within the Building Products industry. This is the kind of institutional-quality demand the strategy seeks.
High Growth Fundamentals
Technical strength alone is insufficient. The High Growth Momentum component of the screen looks for accelerating earnings and sales, which are the catalysts behind sustained price moves.
AAON’s recent fundamental data reveals a story of turnaround and acceleration, which is a hallmark of many super-performers:
- Earnings (EPS) Trends: While the last reported full year (EPS growth 1Y FY) showed a decline (-32.8%), the more recent quarterly data tells a different story. The most recent quarter (EPS Q2Q) grew by 29.7%, and the quarter before that grew by 30.0%. Estimates for the next quarter (EPS Q2Q Q+1) point to explosive growth of 129%. This pattern of improvement from negative territory to strong double-digit growth often acts as a catalyst.
- Sales Growth Acceleration: The revenue picture is equally encouraging. The most recent quarter (Sales Q2Q) surged by 54.3%, building on the previous quarter’s already impressive growth of 42.5%. This acceleration from the prior year’s slower figures is exactly what Minervini looks for, a clear sign of increasing business momentum.
- Estimate Revisions: Analysts are taking notice. The average estimate for next year’s EPS has been revised upward by 10.8% over the last three months, and the revenue estimate has been raised by 16.1%. These upward revisions confirm that the fundamental improvement is being recognized by the market.
This combination of technical strength (rising moving averages, high relative strength) with fundamental acceleration (surging quarterly sales and earnings, positive revisions) is the core of the Minervini philosophy. The stock has recovered from a period of negative earnings growth and is now firing on all cylinders.
Analyst Views and Setup Quality
From a pure chart perspective, the ChartMill Technical Report gives AAON a strong technical rating of 8 out of 10. The setup quality score comes in at 5 out of 10, which is decent. While the stock is near the lower end of its recent trading range and is currently consolidating, the report notes a recent Pocket Pivot signal, a sign of institutional buying on a quiet up day. Key support lies in the $121.12 to $121.73 zone, while the first major resistance is between $129.38 and $132.43.
For investors looking to apply a disciplined, momentum-based approach, AAON presents an interesting case: a high-rated stock that has pulled back from its highs and now shows signs of foundational strength across both technical and fundamental dimensions.
Looking for more stocks that combine Minervini-style technical setups with high growth momentum?
Click here to access the full screen and explore the current list of candidates.
Disclaimer: This content is for informational and educational purposes only and does not constitute investment advice. Trading stocks involves risk, and past performance is not indicative of future results. Always conduct your own research before making investment decisions.
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AAON INC (NASDAQ:AAON) Shows Strong Technical and Fundamental Momentum
The stock market has plenty of stocks rising, but only a select few combine strong technical uptrends with accelerating fundamentals. To identify these potential leaders, investors often rely on systematic frameworks. The screen used to find this candidate applies a dual filter: it first checks for Mark Minervini’s Trend Template criteria, a strict set of technical conditions that confirm a stock is in a strong, sustainable uptrend, and then overlays a High Growth Momentum (HGM) rating of at least 4. This ensures the stock not only looks good on a chart but also possesses the fundamental growth characteristics that historically precede outsized gains.
AAON INC (NASDAQ:AAON) has emerged from this screen as a potential candidate worthy of a closer look. The company, which engineers and manufactures air conditioning and heating equipment, including configurable HVAC systems and high-performance cooling solutions for data centers and cleanrooms, operates in the Building Products industry. Let’s break down why it fits the methodology.
Recent Performance and Technical Trend
The long-term trend for AAON is positive, while the short-term trend is currently neutral. This subtle divergence often occurs during consolidation phases after a strong run, which is precisely where the Minervini strategy looks for entry points.
The Trend Template requires a stock to be in a defined Stage 2 uptrend, and AAON checks every box:
The ChartMill Relative Strength rating of 92.84 is also critical. Minervini emphasizes that leading stocks must outperform the vast majority of the market. AAON’s score means it has outperformed roughly 93% of all stocks, and it also outperforms 97% of stocks within the Building Products industry. This is the kind of institutional-quality demand the strategy seeks.
High Growth Fundamentals
Technical strength alone is insufficient. The High Growth Momentum component of the screen looks for accelerating earnings and sales, which are the catalysts behind sustained price moves.
AAON’s recent fundamental data reveals a story of turnaround and acceleration, which is a hallmark of many super-performers:
This combination of technical strength (rising moving averages, high relative strength) with fundamental acceleration (surging quarterly sales and earnings, positive revisions) is the core of the Minervini philosophy. The stock has recovered from a period of negative earnings growth and is now firing on all cylinders.
Analyst Views and Setup Quality
From a pure chart perspective, the ChartMill Technical Report gives AAON a strong technical rating of 8 out of 10. The setup quality score comes in at 5 out of 10, which is decent. While the stock is near the lower end of its recent trading range and is currently consolidating, the report notes a recent Pocket Pivot signal, a sign of institutional buying on a quiet up day. Key support lies in the $121.12 to $121.73 zone, while the first major resistance is between $129.38 and $132.43.
For investors looking to apply a disciplined, momentum-based approach, AAON presents an interesting case: a high-rated stock that has pulled back from its highs and now shows signs of foundational strength across both technical and fundamental dimensions.
Looking for more stocks that combine Minervini-style technical setups with high growth momentum?
Click here to access the full screen and explore the current list of candidates.
Disclaimer: This content is for informational and educational purposes only and does not constitute investment advice. Trading stocks involves risk, and past performance is not indicative of future results. Always conduct your own research before making investment decisions.
Read full article here »