Allison Transmission Holdings, Inc. (ALSN)

ALSN stock forecast: buy or sell

ALSN stock outlook

  • Counting today, it's been 3 consecutive sessions in negative for Allison Transmission. Price closed today at $36.03 after inching a 1.21%.
  • The stock is configuring an uptrend pattern since mid-May, when it bottomed at $31.53. This rally marked a 14.27% gain
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Important note:
The comments contained in this article are personal and not recommendations for you to buy or sell stocks. The author of this report does not know the particular conditions of the reader, his or her own finances or what is in his or her best interest at any given time. All users should speak with their financial advisor before buying or selling any securities Comments are provided for informational reasons only

ALSN stock chart overview

Should I buy Allison Transmission stock?

All successful traders recommend adhering to a trading strategy and not make decisions based on subjective opinions, rumors or feelings. Trading strategies are meant for helping you in the decision process of what stocks to pick and when is the best moment to buy them. At Stocks2.com, we like to use very simple but trusted and powerful trend following trading strategies. Simple things usually work the best

Is ALSN stock a buy?

Currently, Allison Transmission stock matches one trading strategy:

Uptrend buy setup

Allison Transmission stock continues to trend higher since in mid-May and has marked an amazing 14.27% gain. Price marked a local bottom in this uptrend at $34.22 last Thursday, and since then it bounced up a 5.29%. Now, it's only 16.96% away from breaking out above its last top and resume the uptrend. The new buy point is therefore at $42.14. If you decide to enter this trade, the suggested stop loss is at $37.93

Buy setupBuy pointStop lossRisk
Uptrend buy setup$42.14$37.9310%
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Should I sell Allison Transmission stock?

Knowing when to sell a stock is even harder than knowing when to buy it. Much like when we have to buy shares, choosing when is appropiate to sell is not a whimsical decision, and we must use our own trading style. When selling, as well as buying, detailed strategies are very simple to follow and are only valid for selling stocks in your porfolio, not for selling short Allison Transmission stock

As a rule of thumb, you should not hold an open trade that shows a losses greater than those expected at the time of purchase. When to sell shares must always be determined by the stop-loss (automatic or manual)

Is it time to sell Allison Transmission stock?

In the current situation of Allison Transmission there is not any eligible sell setup, so Allison Transmission stock holders with operations in green can keep their positions

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Analysts' recommendations to buy or sell Allison Transmission stock

Brokerage firms and financial institutions post stock ratings based on their views of the market and the fundamental and technical situation of the analyzed stock. Unfortunately, the accuracy of these predictions is not very high, and certainly not a direct buy or sell signal

In the last month, just one rating was published for Allison Transmission

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Allison Transmission ratings

Brokerage firmRating
Jun 18th, 2020
Citigroup Neutral

Technical analysis

Allison Transmission stock started an uptrend in mid-May, and grew an amazing 14.27%. The price action shows higher highs and lows, and along the way gave very few entry points for those who wanted to trade in. Latest low was last Thursday, when price bounced at $34.22. Like in all uptrends, price needs to take breath and currently price is moving in a range between $42.14 and $34.22

SMAs overview

A favorite tool of many traders are the moving averages, that easily show market direction. A moving average is the average price of a stock over a set period of time. Moving averages are usually calculated on different periods depending on the trading timeframe 21, 50, 100 and 200 days are the most usual moving averages

Supports and resistances

Investors use support and resistance levels as a way to identify price points on a chart that may behave as glass ceiling, containing the price of an asset to move in certain direction. A support level is a level where the price may find support as it falls. This means that the price is more likely to "bounce off" this level rather than break through it. Nevertheless, if the price breaks down this level, it will probably continue falling until meeting another support level. On the other side, resistance levels are where the price tends to find a curb as it rises. In the same manner, this means that the price is more likely to "rebound" at this level, and if it finally crosses this level, it will rise easily until it finds the next resistance

The current resistances are:

  • R1: $36.22 (0.53% above)
  • R2: $36.23 (0.56% above)
  • R3: $36.27 (0.67% above)
  • The current support levels are:

  • S1: $34.96 (-2.97% below)
  • S2: $34.67 (-3.77% below)
  • S3: $34.66 (-3.8% below)
  • Bollinger bands

    This is an indicator that was created in the 1980s by John Bollinger. It comprises 3 bands that are outlined superimposed on the price evolution chart:

    • The central band is a moving average, usually a simple moving average calculated with 20 periods
    • The upper band is calculated by adding to the value of the simple moving average 2 times the standard deviation of the moving average
    • The lower band is calculated by subtracting from the simple moving average 2 times the standard deviation of the moving average

    Since the price broke down the lower band last Thursday, the price bounced by 5.29%

    Relative strength index

    The relative strength index (RSI) is a technical indicator used in the analysis of stock markets. It is intended to plot the current and past weakness or strength of a stock or market based on the closing prices of a recent trading period. Like other oscillation indicators, the RSI fluctuates from 0% to 100%. The relative strength indicator is one of the best known and most widely used indicators, invented by J. Welles Wilder in 1978

    When the Relative Strength Indicator stays for so long below 70 and above 30, without showing moments of overvaluation and undervaluation, the indicator becomes of little use, and we find ourselves in one of these cases.

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    Earnings and financials

    ALSN hosted the investors call and posted the first-quarter report in early May. ALSN beat market estimates and presented an Earnings per Share of $1.20, that is a 26.32% surprise compared to the forecasts of $0.95. Reported revenues were $637.0 million compared to estimates of $586.6 million.

    Compared to the same quarter last year, EPS was $1.32, so reported EPS means a loss of -9.09%. Looking at revenues, figures inched down a -5.63% compared to $675.0M same quarter 12 months ago.

    ALSN releases Q2 earnings report on early next August. Wall Street predicts earnings of %s per-share of $0.21, compared to Q1 that was $1.20. If you own or you are considering buying ALSN stock, be aware that earnings reporting day usually has a very high volatility, and price can soar and sink with very low liquidity and not respecting your buy or stop-loss orders. You can uncover more details about the earnings conference call and the earnings reports on the Investor Relations section of its website: http://www.allisontransmission.com.

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