Mark Minervini's growth-investing strategy is built on a two-sided filter: a stock must first prove itself technically by holding a strong uptrend, then back that price action with fundamental momentum. ULTRAPAR PARTICPAC-SPON ADR (NYSE:UGP) is a Brazil-based distributor and retailer that clears both hurdles, which is why it shows up in a screen that combines Minervini's Trend Template with a High Growth Momentum rating.
The screen behind this candidate
A stock that passes this screen must satisfy the Trend Template's moving-average, price-position, and relative-strength rules. It also needs a High Growth Momentum rating of at least 4, a measure designed for growth investors who want improving earnings, sales, and margins. Few names clear both sets of requirements, so the ones that do deserve closer attention.
Why the trend template is satisfied
Applying the Minervini checklist to the latest price data gives the following picture:
- The last close of 6.55 is above the 50-day, 150-day, and 200-day simple moving averages.
- The 50-day SMA at 5.77 is above both the 150-day SMA at 5.48 and the 200-day SMA at 5.10.
- The 150-day SMA is above the 200-day SMA, and the 200-day SMA is rising, confirming a long-term uptrend.
- The price is roughly 98% above its 52-week low of 3.30 and within about 2% of its 52-week high of 6.665. The technical report notes that a new 52-week high is being made.
- Relative strength is 94.76, meaning the ADR outperforms nearly 95% of the market. That is well above Minervini's 70 threshold and inside the preferred 80s to 90s zone.
These criteria matter because Minervini does not try to catch falling knives. He focuses on Stage 2 uptrends, where stocks are already being accumulated by institutional buyers. A stock trading near its high, above rising moving averages, and with high relative strength is showing demand, not just value.
What makes it a high-growth candidate
The fundamental side of the screen is supported by several acceleration signals:
- EPS growth over the trailing 12 months is 23.8%, with the latest quarter up 48.1% year over year and the prior quarter up 167.0%.
- The next-quarter EPS estimate points to 46.2% year-over-year growth, suggesting analysts expect the momentum to continue.
- Revenue growth in the latest quarter is 25.2% year over year, and the next-quarter revenue estimate implies 21.1% growth.
- Next-year EPS estimates have been revised up by 9.6% over the past three months.
- The company has beaten EPS estimates in three of the last four quarters, with an average beat of roughly 52.7%.
One area that is less consistent is profit margin. The latest quarterly net margin improved to 2.38% from 0.85% in the prior quarter, but it remains below the 3.26% posted four quarters ago. That keeps the margin story in the "improving but still mixed" camp. Free cash flow is stronger, however, with FCF per share of 0.82 and 75.7% growth in FCF over the past year.
For Minervini investors, the combination is important because technical strength alone is not enough. The strategy looks for companies where earnings and sales momentum can attract institutional buying. Upward estimate revisions and earnings acceleration often appear before a sustained price move, so the fundamental screen is designed to catch those names early.
What the technical report says
At a high level, the ChartMill technical report gives this stock a 10/10 technical rating. Both the long-term and short-term trends are positive, and the ADR is one of the better performers in its industry group, outperforming roughly 95% of its peers.
The setup rating is lower at 7/10. The report notes that recent price movement has been a little too volatile to produce a clean entry and exit point, so waiting for consolidation may be prudent. The main resistance area sits near 6.56 to 6.57, while support is identified around 6.03 to 6.11 and again near 5.77 to 5.93. The automatic setup suggests an entry above 6.58 with a stop near 5.83, implying a worst-case loss of roughly 11.5% on the position.
Investors who want to dig into the moving-average alignment, support levels, and indicator history can use the technical analysis report.
Risks and limitations
The stock has already rallied roughly 95% over the past year, so some mean-reversion risk exists. In addition, the one-month performance is slightly negative, and the technical report warns that prices have been rising strongly lately. That suggests the next opportunity may come after a pullback or a period of tighter price action rather than immediately.
Fundamentally, the margin trend is not as clean as the earnings and revenue acceleration. Brazil exposure also adds currency, regulatory, and macroeconomic considerations that a purely technical screen does not capture.
Where to find more Minervini candidates
Investors who want to run the same combination of Trend Template rules and High Growth Momentum filters can find more stocks matching this methodology in this stock screen.
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 »
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ULTRAPAR (NYSE:UGP) Clears Minervini's Growth Screen With Strong Technicals and Fundamentals
Mark Minervini's growth-investing strategy is built on a two-sided filter: a stock must first prove itself technically by holding a strong uptrend, then back that price action with fundamental momentum. ULTRAPAR PARTICPAC-SPON ADR (NYSE:UGP) is a Brazil-based distributor and retailer that clears both hurdles, which is why it shows up in a screen that combines Minervini's Trend Template with a High Growth Momentum rating.
The screen behind this candidate
A stock that passes this screen must satisfy the Trend Template's moving-average, price-position, and relative-strength rules. It also needs a High Growth Momentum rating of at least 4, a measure designed for growth investors who want improving earnings, sales, and margins. Few names clear both sets of requirements, so the ones that do deserve closer attention.
Why the trend template is satisfied
Applying the Minervini checklist to the latest price data gives the following picture:
These criteria matter because Minervini does not try to catch falling knives. He focuses on Stage 2 uptrends, where stocks are already being accumulated by institutional buyers. A stock trading near its high, above rising moving averages, and with high relative strength is showing demand, not just value.
What makes it a high-growth candidate
The fundamental side of the screen is supported by several acceleration signals:
One area that is less consistent is profit margin. The latest quarterly net margin improved to 2.38% from 0.85% in the prior quarter, but it remains below the 3.26% posted four quarters ago. That keeps the margin story in the "improving but still mixed" camp. Free cash flow is stronger, however, with FCF per share of 0.82 and 75.7% growth in FCF over the past year.
For Minervini investors, the combination is important because technical strength alone is not enough. The strategy looks for companies where earnings and sales momentum can attract institutional buying. Upward estimate revisions and earnings acceleration often appear before a sustained price move, so the fundamental screen is designed to catch those names early.
What the technical report says
At a high level, the ChartMill technical report gives this stock a 10/10 technical rating. Both the long-term and short-term trends are positive, and the ADR is one of the better performers in its industry group, outperforming roughly 95% of its peers.
The setup rating is lower at 7/10. The report notes that recent price movement has been a little too volatile to produce a clean entry and exit point, so waiting for consolidation may be prudent. The main resistance area sits near 6.56 to 6.57, while support is identified around 6.03 to 6.11 and again near 5.77 to 5.93. The automatic setup suggests an entry above 6.58 with a stop near 5.83, implying a worst-case loss of roughly 11.5% on the position.
Investors who want to dig into the moving-average alignment, support levels, and indicator history can use the technical analysis report.
Risks and limitations
The stock has already rallied roughly 95% over the past year, so some mean-reversion risk exists. In addition, the one-month performance is slightly negative, and the technical report warns that prices have been rising strongly lately. That suggests the next opportunity may come after a pullback or a period of tighter price action rather than immediately.
Fundamentally, the margin trend is not as clean as the earnings and revenue acceleration. Brazil exposure also adds currency, regulatory, and macroeconomic considerations that a purely technical screen does not capture.
Where to find more Minervini candidates
Investors who want to run the same combination of Trend Template rules and High Growth Momentum filters can find more stocks matching this methodology in this stock screen.
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 »