Aflac (AFL), the insurance giant known for its talking duck commercials, saw its Relative Strength Rating rise from 69 to 74 on Tuesday. Aflac stock recently formed a cup-with-handle base. It has yet to break out though it’s near the buy point.
The 74 RS Rating means that Aflac stock is outperforming 74% of all stocks in IBD’s database. Stocks that go on to make the biggest gains often have an RS Rating of over 80 in the early stages of their moves. See if Aflac can continue to show renewed price strength and clear that threshold.
Among other key ratings, Columbus, Ga.-based Aflac, which primarily sells supplemental insurance in the U.S. and Japan, has an 83 EPS Rating. That means it’s in the top 17% of all companies in recent and long-term profit growth.
Aflac stock holds the No. 1 rank among its peers in the Insurance-Accident & Healthcare industry group. CNO Financial (CNO) and Independence Holding (IHC) are also among the top-five ranked companies in the group.
Additionally, Aflac stock has a middling 68 Composite Rating.
IBD’s Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Regarding fundamentals, AFLAC reported 24% earnings growth in its most recent report, to $1.59 per share. Sales grew a mild 3% to $4.56 billion. The company recorded 25% EPS growth the prior quarter.
Commenting on second quarter results in a July 28 news release, CEO Daniel Amos said, “With respect to second quarter sales results in the United States and Japan, we continued to see improvement and expect a stronger second half of the year in both countries.” Amos added that he remains “cautiously optimistic and vigilant as vaccination efforts continue in the face of uncertainty associated with emerging variants.”
AFLAC broke out earlier, but is now about 4% below the prior 57.67 entry from a cup-without-handle. Also keep in mind that the latest consolidation is a later-stage base, which can work well but makes it riskier to establish a new position or add shares to an existing one. It closed Tuesday down 1.7% at 54.29.
When looking for the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD’s unique Relative Strength Rating measures market leadership by using a 1 (worst) to 99 (best) score that shows how a stock’s price performance over the last 52 weeks compares to other publicly traded companies.
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