Forming a Head and Shoulders Pattern, What’s Next for Xcel Brands, Inc. (:XELB)

by Engelwood Staff — November 28, 2016

Shares of Xcel Brands, Inc. (:XELB) have formed an inverse Head and Shoulders Pattern, What’s Next? The stock currently sits at $4.95.

An “inverse head and shoulders” pattern is a technical financial chart pattern which predicts the reversal of a current downtrend. The pattern is noted when the price action of a stock price falls to a trough and then rises, followed by the price falling below the former valley and then rises for a second time, and, finally, the price falls once more, but not to the depths of the second valley.

Once the final valley is created, the price heads back up toward the top of the previous valleys. The first and third valley are considered to be the “shoulders”, where the second peak creates the “head”. Traders will look for a large increase in volume, thus confirming the validity of the reverse breakout. This pattern is the inverse of the head and shoulders pattern, which predicts shifts in a downtrend rather as opposed to an uptrend.

RECOMMENDATION

Based on the current consensus analyst target price of 4.95, analysts have a current recommendation of 2.00 on the shares. This is on a consensus basis according to Thomson Reuters. Using the formula PEG (P/E) / Annual EPS Growth (the ratio used to determine a stock’s value while taking into account the earnings’ growth), Wall Street is confident with this recommendation.

RECENT PERFORMANCE

Let’s take a look at how the stock has been performing recently. Over the past twelve months, Xcel Brands, Inc. (:XELB)’s stock was -33.99%. Over the last week of the month, it was -1.00%, -2.94% over the last quarter, and -16.39% for the past six months.

Over the past 50 days, Xcel Brands, Inc. stock was -6.60% off of the high and 23.75% removed from the low. Their 52-Week High and Low are noted here. -40.00% (High), 23.75%, (Low).

Disclaimer: The views, opinions, and information expressed in this article are those of the authors and do not necessarily reflect the official policy or position of any company stakeholders, financial professionals, or analysts. Examples of analysis performed within this article are only examples. They should not be utilized to make stock portfolio or financial decisions as they are based only on limited and open source information. Assumptions made within the analysis are not reflective of the position of any analysts or financial professionals.