Commerce Bancshares Inc. (NASDAQ: CBSH) shares fell on Monday January 23 on lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.
Meanwhile, U.S. stocks flipped between small gains and losses in early trade on Monday.
The Dow Jones Industrial Average DJIA, -0.14% was off by 13 points, or less than 0.1%, at 19,815, with McDonald’s Corp MCD, -0.99% and General Electric CoGE, -0.95% leading the losses, down more than 1%.
The S&P 500 SPX, -0.18% slipped 2 point to 2,270, with five of the main sectors trading lower. The Nasdaq Composite COMP, -0.09% gained 4 points to 5,558.
Analysts at Zacks downgraded shares of Commerce Bancshares Inc. (NASDAQ: CBSH) from Buy to Hold in a research note to investors today. The company currently has a rating of Hold on the stock. The one-year price target of $53.10 is a decrease compared to the opening price of $54.59, causing a fair amount of other analysts to issue statements on the stock recently. Looking back over the last 52 weeks, Commerce Bancshares Inc. stock has a high of $59.22. Important and integral changes in the company’s actions, future outlook or industry can cause downgrades as the analysts believe that the future prospects for the security have weakened from the initial recommendation.
Shares of Commerce Bancshares Inc. (NASDAQ: CBSH) opened at $54.59 yesterday trading between $54.59 and $55.01, and last traded at $54.80, which represents a dip of $0.20 compared to the previous closing price.
Commerce Bancshares Inc. (NASDAQ: CBSH) currently has a market cap of 5.56B.
Commerce Bancshares Inc. (NASDAQ: CBSH) Average Daily Trading Volume
19,062 shares traded hands yesterday, 120 percent lower than the average, out of a total float 87,063,000. lower than normal. Look for trading volume to pick up in the coming days as momentum traders often use increases in trading volume to identify heavy volume accumulation or distribution by institutional investors.
However, a single day of heavy buy side trading is not enough to assert a trend. As such, market traders will continue to watch for institutional sponsorship as a signal that financial institutions are moving forward.
Institutional sponsorship simply refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.
Institutional investors such as these retain substantial teams of analysts researching thousands of stocks, so it is good validation to see them buying a stock you’re researching.
Commerce Bancshares Inc. (NASDAQ: CBSH) 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 identifying trends, moving averages allow traders to make those trends work in their favor and increase the number of successful trades.
With that in mind, Commerce Bancshares Inc. (NASDAQ: CBSH) now has a 50-day MA of $57.55 and 200-day MA of $50.05. It has traded in a 52-week range between $35.99 – 59.22 and today’s last price is 7.46%% lower than the 52 week high of $59.22.
Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors seek companies that have been successful at growing their earnings at least 25% or more over 3 consecutive years.
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