SPR trade ideas
Spirit AeroSystems 30d Short $17 - Floor Hasn't Hit YetNYSE:SPR
Spirit AeroSystems will rebound, but not right now. All signs point to the price on a decline to below $17. They have halted production for Boeing jets indefinitely, cutting pay, and furloughing workers. Stimulus package will not save them in the short term, as they are too heavily reliant on their largest customer Boeing (80% of revenue). Once the floor has hit, I will look to value buy this stock.
I support what the Bears say: 'With its improved cash flow, Spirit will embark on value-destructive acquisitions. Customer concentration with Boeing (roughly 80% of revenue) leaves Spirit vulnerable to unfavorable negotiations and steep price step-down demands. Following 15 years of growth, the aerospace cycle will turn over, causing Boeing and Airbus to cancel deliveries and throttle back production, negatively affecting Spirit.” - Morningstar May 31, 2019
Be effective and happy trading!
- Darell
SPR Weekly - new supply zoneWatch SPR weekly. It had its retracement, time to bounce back based on its new supply zone at 63, and the target will be 84 based on Fib retracement:
What do you think?
Very strong weekly chart of Spirit AeroSystems Possible entry levels $91.27 - $97 - $106. dependent on risk and market sentiment.
Chart is technically bullish with multiple strong rejections of the rising lower trendline.
Moving averages are also in a strong format.
P/E ratio very fair value.
Company profile
Spirit AeroSystems Holdings, Inc. engages in the design and manufacture of aero structures for commercial and defense aircraft. It operates its business through the following segments: Fuselage Systems, Propulsion Systems, and Wing Systems. The Fuselage Systems segment develops, produces and markets forward, mid, and rear fuselage sections and systems. The Propulsion Systems segment offers struts or pylons, nacelles, and related engine components. The Wing Systems segment includes the development, production, and market of wings, wing components, and other miscellaneous structural parts to primarily aircraft original equipment manufacturer, related spares, and maintenance, repair, and overhaul services. The company was founded on February 7, 2005 and is headquartered in Wichita, KS.
SPR Short swing tradeMonthly chart showing exhaustion. But this is just a quick trade for about $1.50.
SPR retests $50I last looked at SPR in February when price broke out above the December 2014 high. At that time I was waiting for the earnings announcement and to see how price reacted to the $50 half-figure.
Price has continued to move upwards and the trend is beginning to look good. The latest earnings announcement saw price pullback to below the 50sma and retest the $50 level again. However, this pullback was not too deep. Now this period is passed - and a good trend has already begun to emerge - this is a stock for my watchlist.
Market conditions are not yet ready for me to look for new positions right now. However, the same stocks keep cropping up because their trends are stronger than the overall markets. Therefore it is likely that I will continue to occasionally revisit the same charts until we get some more decisive market movements.
SPR completes bullish flagThe uptrend for SPR is still a little erratic. It has been using the daily 200ma as support rather than the 50ma - so the pullbacks have been deep and prolonged. This has not made it easy to trend trade.
However, since breaking above the 2007 high ($41.72) we have seen a slight change in personality. Price did struggle at this level and retested the area three times during December 2014 and January 2015. The retests were not clean but the 50ma also came into play so we now have a very strong support zone.
Yesterday's bar confirmed a bull flag - which also broke above the recent pivot high, on higher volume, and with a very bullish bar. However, this stock is not ready to trade right now as earnings are due today - so we should wait to see how this plays out. Price is also approaching the $50 half figure.
