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HubSpot Stays In Rally Mode

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HubSpot is back above its 10-week moving average after soaring more than 10% last week.

Video Transcript


- Well, let's take a look underneath the surface. Starting off with HubSpot. And this stock was able to gain over 6% today. We're also going to flip on over to the weekly chart. But Ken, HubSpot in the software group showing continued strength after pulling back down to its 50-day line. It was a bit disappointing, I think, to see all those post-earnings gains from that gap-up fade, but at least it did find support at a key level.

- Yeah, it did find support at the 50-day moving average. It has rallied nicely off the 50-day moving average. It looks a little bit like the NASDAQ, just a nice solid move in recent days. And again, software stocks were such a big leadership part of the market in 2020. Not so much anymore, but HubSpot has been-- software stocks had a pretty good day today. And I just like the look of HubSpot's weekly chart here.

You can see the stock was up more than 10% last week, I think was the gain? Yeah. 10% gain last week, and it's extending gains today. So we want to just keep an eye on this one. Good one for the watch list. Like the big sales growth in recent quarters here. It's a company that does marketing and sales software. So they're in a nice niche with good sales growth. And even though earnings growth has slowed down in recent quarters, they do have a couple of nice annual estimates there for 2021 and 2022. So I like that as well.

- Yeah. And aggressive investors could potentially initiate a position here with the stock being within 10% of that 10-week line, while others may want to see a little bit more in the development of the right side of this base. Maybe we see a handle for, maybe we see a breakout of this consolidation here, Ken. So no matter what your investing style, it seems like HubSpot is worth a look, which is why we're featuring it today.

- Yeah, definitely. Let's go back to the weekly chart too because there was a really, really big increase in fund ownership in the fourth quarter of last year. You can see at the end of the third quarter there were 630 funds that had a position in this stock. And then by the end of the fourth quarter, it jumped all the way to 872. So we do talk a lot about institutional sponsorship fund, quality fund sponsorship. So not only does HubSpot have-- not only is it showing big increases in fund ownership in recent quarters, but it also has some high quality fund ownership as well. And not surprising when you see the sales growth this company has reported in recent quarters.