Titan: Mid to Long Term Yes, Short Term not Necessarily
Yellow caution sign. Fact, TITN stock has fallen since February 19, reaching a low today of $ 27.17 on high trend confirming volume, based in part on a report from Citron Research.
Additionally TITN has a comparatively high forward PE of 13.04 and low Gross Margins of .16, signaling excessive valuation, without any dividend support. The company also has a very high short % of float of 11.7%, 10% is considered by many to be the threshold for a potential “ battleground stock “. Stock technical’s are also pointing to frothiness, MACD is weakening, and 5 day EMA slipped below 13 day EMA February 21. The stock has dropped below the the 20 and 50 day SMA and is headed in the direction of the 200 day.
Lastly, many expect the market to pullback by 5-10% sometime between now and the replay of the Washington DC thriller horror movie " Sequestration " at the beginning of March. A low beta stock could expect to experience a ratable retrenchment, higher beta issues have exaggerated movements up in good times and down during pullbacks. Put in context, during the last confrontation over the sequester in November, TITN dropped from $ 23.95 November 6 to $ 19.77 November 15, not sustainable surpassing $ 23.95 until December 18.
Conclusion, TITN is a quality company, however at current price levels the 30-45 day risk/return is disproportionately negative. A price pullback, normal market correction or sequester inspired retrenchment or any combination suggests price range closer to $ 23.90 offers a better return with lower risk.