Approach Resources Inc. (NASDAQ: AREX) shares rose in value on Friday January 20 on lighter trade volume than normal after a number of analysts weighed in on the investing value of the stock with a upgraded rating.
Meanwhile, U.S. stocks rose Friday morning as Wall Street closely awaited Donald Trump’s inauguration as the nation’s 45th president.
The Dow Jones Industrial Average DJIA, +0.41% rose 95 points, or 0.5%, to 19,826, while the S&P 500 index SPX, +0.41% climbed 11 points, or 0.5%, to 2,275 and the Nasdaq Composite COMP, +0.37% added 28 points, or 0.6%, to 5,571.
Analysts at KLR Group upgraded shares of Approach Resources Inc. (NASDAQ: AREX) from Accumulate to Buy today. With a rating of Buy on the stock, the company has a 52-week high of $4.35. The one-year price target of $3.50 is higher than the opening price of $3.30, causing a fair amount of other analysts to report on the stock in recent days. Stock prices often move to the upside on recommendations and new price targets of professional brokerage firms.
Yesterday Approach Resources Inc. (NASDAQ: AREX) shares last traded at $3.20, a spike of $0.06 from the previous closing price. Opening at $3.30, they varied from $3.17 and $3.30 throughout the day.
Approach Resources Inc. (NASDAQ: AREX) currently has a market cap of 133.16M.
Approach Resources Inc. (NASDAQ: AREX) Average Daily Trading Volume
The stock’s average daily volume is 1,161,700 shares out of a total float 38,344,000 and some 217,489 shares crossed the trading desk yesterday, 25 percent below normal. lower than normal. Look for trading volume to pick up in the coming days as momentum traders often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.
As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.
Institutional sponsorship just refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.
Professional investors such as these retain teams of analysts that research thousands of stocks, so it is good validation to see them buying a stock you’re considering.
Approach Resources Inc. (NASDAQ: AREX) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
By spotting trends, moving averages allow traders to make those trends work in their favor and increase the number of successful trades.
Trades for Approach Resources Inc. (NASDAQ: AREX) have ranged from $0.60 – 4.3500, and the stock now has a 50-day MA of $3.49 and 200-day MA of $2.93. Today’s last price is 26.43%% lower than the 52 week high of $4.35.
Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors seek companies that have increased their earnings at least 25% or more for a 3 year period.
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