Examining technical and sentiment indicators for National Fuel Gas

Tag : Fuel Pressure System

Contrary to the stock's performance, analysts are not impressed.According to Zacks , only 1 brokerage firm rates the shares "strong buy." Theremaining 5 brokerages are recommending "hold." What's more, thecompany's 12-month price target is currently $55.45. This suggeststhat brokerages assume the stock has hits its peak and will fall atleast 2% within the next year.
Short-term option player sentiment is also pessimistic. TheSchaeffer's put/call open interest ratio (SOIR) for NFG stands at0.54. While this number indicates that there are more calls thanputs on options that expire in less than 3 months, it is moreeffective to compare this number to all of those during the past 12months. This reading is higher than 93% of all the readings takenduring the past year. In other words, option players have been morebearishly aligned only 7% of the time during the past 52 weeks.
Short sellers are also betting that the stock is going to start tofall. These bears have sold short 5.7 million shares, accountingfor almost 8% of the company's float. With the stock in an uptrend,if these pessimistic investors begin to buy back their shares, itcould take more than 10 days at the stock's average daily tradingvolume for these bets to unwind. This could leave ample potentialfor a short-covering rally and add more buying pressure to theshares.
In conclusion, Natural Fuel Gas followers should keep an eye on thestock's 20-week moving average. If the stock is able to bounce offthis trendline, it could move significantly higher. From acontrarian perspective, the strong amount of pessimism surroundingthe uptrending stock has bullish implications. Should the sharescontinue to make progress on the charts, an unwinding of skepticism whether among the short sellers, the brokerages, or short-termoption players  could help fuel the stock even higher.