A common mistake in growth investing is buying a stock with impressive earnings but a poor chart, or a great chart with no fundamental support. The scanning approach used here tries to avoid both traps by requiring a High Growth Momentum rating above 4, a technical rating of at least 7, and a setup rating of at least 7. IMAX CORP (NYSE:IMAX) is one of the securities that comes through this filter, carrying a High Growth Momentum rating of 6 out of 10, a technical rating of 10, and a setup quality rating of 7.
Why IMAX scores on growth momentum
The High Growth Momentum rating looks beyond a single earnings number, combining year-over-year and quarter-over-quarter growth, free cash flow trends, margins, estimate revisions, and earnings surprises. IMAX posts solid numbers across most of those categories:
- EPS growth (TTM): 63.4% year over year
- EPS growth, most recent quarter vs. same quarter last year: 65.4%
- Free cash flow per share (TTM): $2.23, with FCF growth of 201.9% over the past year
- EPS estimate beats: 4 out of the last 4 quarters, with an average beat of 26.6%
- Profit margin, most recent quarter: 15.0%, up from 5.2% in the prior quarter
- Analyst revisions: next-year EPS estimates have moved up 6.5% in the last 3 months
The 6 out of 10 growth score reflects real strength in earnings and margins, though not a perfect profile. Sales growth in the prior quarter dipped 6.1%, and the next quarter's expected EPS growth of 12.0% is more moderate than the recent pace. That mix is typical for stocks that score well but leave room for improvement, and it is why the rating works best as a filter rather than a standalone verdict.
Technical strength and a defined setup
On the chart side, the technical report is about as strong as it gets. IMAX receives a technical rating of 10 out of 10, with both the short-term and long-term trends positive. The stock is trading near its 52-week high of $52.62, all major moving averages are rising, and relative strength ranks it ahead of 96% of the market. Returns of 30.8% over the past month and 102.8% over the past year show that the trend is not just positive but also persistent.
The setup rating of 7 points to a price pattern that is consolidating rather than extended. The report notes reduced volatility, little resistance above the current price, and signs of large players taking an interest. Support areas sit at $48.48 and lower, which gives traders a defined reference for a stop loss. Investors who want the full detail on support, resistance, and trend indicators can review the complete technical analysis report.
Why the combination matters
The logic of screening on both growth momentum and technical setup is to increase the odds that a stock is improving fundamentally while still offering a reasonable entry point. A high technical rating alone can flag a stock that is already extended; a high growth rating alone can flag a stock whose story is sound but whose chart offers no good entry. IMAX scores well on both, and the consolidation pattern gives the stock a defined risk level rather than an open-ended chase.
There are caveats, of course. The setup rating of 7 is at the threshold of the screen rather than deeply above it, and the suggested setup implies an entry near $52.63 with a stop near $48.47, a distance of roughly 7.9%. The stock has already moved sharply higher in a month, so discipline around entry and position sizing matters. The generated trade is an automated example, not a recommendation, and upcoming earnings or news should always be checked before acting.
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Investors who want to find more stocks that combine high growth momentum with strong technicals and a breakout setup can run the screen to see the latest list.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
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IMAX (NYSE:IMAX) Shows High Growth Momentum and a Breakout Setup
A common mistake in growth investing is buying a stock with impressive earnings but a poor chart, or a great chart with no fundamental support. The scanning approach used here tries to avoid both traps by requiring a High Growth Momentum rating above 4, a technical rating of at least 7, and a setup rating of at least 7. IMAX CORP (NYSE:IMAX) is one of the securities that comes through this filter, carrying a High Growth Momentum rating of 6 out of 10, a technical rating of 10, and a setup quality rating of 7.
Why IMAX scores on growth momentum
The High Growth Momentum rating looks beyond a single earnings number, combining year-over-year and quarter-over-quarter growth, free cash flow trends, margins, estimate revisions, and earnings surprises. IMAX posts solid numbers across most of those categories:
The 6 out of 10 growth score reflects real strength in earnings and margins, though not a perfect profile. Sales growth in the prior quarter dipped 6.1%, and the next quarter's expected EPS growth of 12.0% is more moderate than the recent pace. That mix is typical for stocks that score well but leave room for improvement, and it is why the rating works best as a filter rather than a standalone verdict.
Technical strength and a defined setup
On the chart side, the technical report is about as strong as it gets. IMAX receives a technical rating of 10 out of 10, with both the short-term and long-term trends positive. The stock is trading near its 52-week high of $52.62, all major moving averages are rising, and relative strength ranks it ahead of 96% of the market. Returns of 30.8% over the past month and 102.8% over the past year show that the trend is not just positive but also persistent.
The setup rating of 7 points to a price pattern that is consolidating rather than extended. The report notes reduced volatility, little resistance above the current price, and signs of large players taking an interest. Support areas sit at $48.48 and lower, which gives traders a defined reference for a stop loss. Investors who want the full detail on support, resistance, and trend indicators can review the complete technical analysis report.
Why the combination matters
The logic of screening on both growth momentum and technical setup is to increase the odds that a stock is improving fundamentally while still offering a reasonable entry point. A high technical rating alone can flag a stock that is already extended; a high growth rating alone can flag a stock whose story is sound but whose chart offers no good entry. IMAX scores well on both, and the consolidation pattern gives the stock a defined risk level rather than an open-ended chase.
There are caveats, of course. The setup rating of 7 is at the threshold of the screen rather than deeply above it, and the suggested setup implies an entry near $52.63 with a stop near $48.47, a distance of roughly 7.9%. The stock has already moved sharply higher in a month, so discipline around entry and position sizing matters. The generated trade is an automated example, not a recommendation, and upcoming earnings or news should always be checked before acting.
(empty)
Investors who want to find more stocks that combine high growth momentum with strong technicals and a breakout setup can run the screen to see the latest list.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
Read full article here »