How to use our analysis tools
In early December 2010, two quiet shares were poised to start performing. Many investors failed to notice the emerging opportunity, but our powerful research tools could have helped you spot potential in these companies.
Before December, Grainger PLC and St Modwen Properties PLC were experiencing a very negative year, with both companies seeing share price declines of over 25% since the beginning of 2010. However, by combining information from our range of Shares Analysis indicators, it would have been possible to predict that the fortunes of these two companies were likely to reverse.
Identify opportunities
On 1 December 2010, both Grainger PLC and St Modwen Properties PLC appeared on our FTSE® Factsheet, near the top of the 'Relative Strength Index (RSI) Oversold' list. The RSI is a technical analysis gauge that provides an index level between 0 and 100 depending on the performance of a share over the last 14 days.
The closer the reading is to 100, the more 'overbought' it is said to be, with levels over 70 likely to face a downward correction. At the other end of the scale, readings below 30 are said to be 'oversold' and are likely to experience a rebound.
At the beginning of December, both Grainger and St Modwen were displaying RSI levels significantly below 30, as the table below illustrates:
Looking at some filtered Director Dealings information from the same day, we can clearly see that the directors of both companies (and Grainger directors in particular) bought company shares in the lead up to December. This analysis suggests the directors saw recent declines in their companies’ share prices as an attractive buying opportunity.
The FTSE® Broker Ratings from 1 December 2010 also flags St Modwen Properties as a 'Buy' recommendation from Numis Securities.
Rapid growth
Using a combination of the three research tools in our Shares Analysis section, we can see that Grainger and St Modwen Properties both represented appealing buying opportunities in early December. Indeed, as the table below shows, over the course of December both companies saw percentage gains several times higher than the FTSE® 350 over the same period:
Learn more
Our Shares Analysis tools are updated several times a day by our dedicated in-house research team, and consist of:
- FTSE® Factsheet - provides a detailed breakdown of key company performance metrics and highlights individual firms worth keeping an eye on
- Director Dealings - focuses on purchases and sales by the directors of LSE-listed companies
- Broker Ratings - identifies both global and UK companies affected by a recent ratings change
For more information, and a chance to see up-to-the-minute data, please visit our Shares Analysis section.
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