The major stock market indexes are dealing with their resistances at the moment. Apple helped to bring Nasdaq and Dow higher since it makes a considerably big portion of each. Whether it goes up more or not, since it’s quite overbought now doesn’t really matter. Because the influence was done, the healthy stocks even in the other sectors are poised to surge due to overall impact ETFs and the stock market as a whole. One of such is Centene Corp. (NYSE: CNC)


Centene Corp.

A company provides services to government-sponsored health care programs. It operates via two segments: Managed Care and Specialty Services. Centene is headquartered in St. Louis.

The company applies very for trend following strategy when the current bull trend will be driven higher securing profits for the investors.


Valuation and Profitability Ratios

Return on Equity (RoE) = 12.99

Return on Invested Capital (RoIC) = 7.50

Debt to Enterprise Value (EV) = 0.21

The revenue has been constantly growing on an annual basis and the last four reported earnings have beaten the estimates always. The most recent earnings crushed the estimates big time – by almost 11%!

Technical Analysis

Centene was running in a bull trend channel for one year and a half until the recent market correction broke the trend. It has managed to consolidate at its 100 SMA and returned on a new track in April (see the blue lines). The recent earnings forced the stock to breakout to a new high piercing the resistance (orange line). This is an important thing. Centene stock is now retesting the resistance – new support and may likely to sit on the 20 EMA before it goes up again. Following this trend is well supported by technical indicators:

Volume – extremely high volume as a result of the earnings. Investors want an ownership of this company and they want to keep it. This is a very important sign.

RSI – positive and going upward, well applying to Cardwell theory.

MACD – MACD line above the signal line.

CMF – Strong buying power.


Centene trend following

Centene Corp. offers a great investing opportunity. Important is to stay disciplined and focused on the big picture!



This post is only an opinion of a contributor. It serves for informative and educational purposes only. The article is not an investment recommendation. Trading any financial instrument involves risk and thus, you should consult every financial decision with your financial advisor. Read our full disclaimer!

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