Sign InNVOS Stock Shows Potential for Continued Growth Despite Overbought Conditions
Summary
Novo Integrated Sciences, Inc. (NVOS) has seen a significant increase in its stock price after entering a joint venture in Kenya, leading to a prediction of continued upward momentum; however, caution is advised due to the stock's overbought status and negative EPS.
Fundamental Analysis
Novo Integrated Sciences, Inc. (Ticker: NVOS), whose last close was on August 16, 2023, at a price of $0.18, has a significant market cap of $26.88 million. The stock has a year high price of $1.81 per share, and a year low price of $0.07 per share. The substantial variation in the year low and high suggests considerable volatility over this period. The company has a substantial volume of 397.77 million against an average volume of 8.95 million.
The company's EPS stands at -1.13, which indicates negative profitability. Furthermore, it has a negative Price/Earnings ratio of -0.16, indicating lower-than-expected results compared to competitors. NVOS has around 148.43 million shares outstanding, contributing to its market cap.
Recently, Novo Integrated Sciences has been on the headlines after entering a joint venture (JV) with Canada's Farm 7 Group to implement the Kenya Agricultural Cooperative Project. This news has positively influenced the stock, pushing it up by 60%.
Technical Analysis
NVOS ended the trading day with a gain of 56.12%, which indicates strong upward momentum. The stock’s Relative Strength Index (RSI14) currently stands at 71, pointing towards an overbought condition. However, the substantial movement in the stock price is reflective of the positivity from the recent joint venture news.
The stock is trading above both its 50-day ($0.12) and 200-day ($0.15) moving averages, indicating an overall bullish sentiment in the short to medium term. The MACD (Moving Average Convergence Divergence), a trend-following momentum indicator, is currently negative at -0.01 showing a bearish trend over the past three months. However, the recent upswing may change this scenario soon.
The stock has seen a low price of $0.17, with no specified resistance level, indicating potential room for further growth. The lack of an established resistance level combined with the positive news and bullish sentiment may allow the stock to continue its upwards trajectory.
Prediction and Evaluation
Considering both the fundamental and technical analysis, it is anticipated that the NVOS stock could continue the upward trend on the next trading day, August 17, 2023. Given the lack of resistance, the momentum from recent news of the JV agreement and the bullish sentiment surrounding the stock, it could potentially continue the upward trajectory into the coming week.
However, investors should keep in mind the current Overbought status indicated by RSI and the negative MACD, hinting towards a possible correction following the sharp increase in the stock price.
In the light of these considerations, NVOS is evaluated as a Hold. Despite the sharp increase and favourable news, the overbought status and negative EPS bring caution. It's advisable for investors to monitor the stock closely and look for signs of sustained bullishness or an outset of a downward correction before making new investment decisions.
