HNST: When honesty turns into a breakout formationOn the weekly chart, The Honest Company (HNST) is shaping a textbook broadening formation. Four waves are already in place, and the fifth is unfolding. The recent bounce came exactly after a retest of the long-term trendline at point (4), pushing the price above the critical $4.97 resistance (0.236 Fibo) — a clear signal that buyers are reclaiming control.
Volume is steadily rising, and the golden cross (MA50 crossing above MA200) further confirms a mid-term trend shift. The volume profile above current prices is nearly empty — indicating minimal resistance. Immediate targets are $6.33 and $6.94 (0.5 and 0.618 Fibo), while the full breakout projection lands at $8.91, $10.31, and even $12.09 (based on 1.0, 1.272, and 1.618 expansions).
Fundamentals (as of June 28, 2025):
— Market Cap: ~$460M
— Revenue (TTM): ~$344M
— YoY Revenue Growth: +7.6%
— EPS: –0.18 (loss narrowing)
— Cash on hand: ~$24M
— Debt: under $10M
— P/S ratio: 1.34
Despite being unprofitable, HNST is showing strong signs of operational improvement — rising gross margins, controlled costs, and increasing leverage. Growth in both online and retail sales adds further support. With institutional buying picking up, the market may be slowly re-rating this small-cap FMCG player.
Trade Plan:
— Entry: by market
— Targets: $6.33 → $8.91 → up to $12.09
When even an "honest" stock starts drawing broadening patterns and volume’s rising — it’s not a hint, it’s a launch sequence. And the bears? Might want to take a seat in the back.
