RPM Global (RUL) had us a bit worried when the company reported earnings on the 16th of February. The initial reaction was for the share price to gap down to $1.71 before recovering to close at $1.82.
The share price found support at its 10-day moving average (black line) and has for the most part respected this level throughout the recent consolidation and the break higher yesterday to a 12-month closing high of $2.29.
To protect the capital invested and to lock in profits should the share price start to fall back, we will increase the stop loss level to $2.10 the 20-day moving average and also lock in profit on part of the position by selling 700 shares at $2.25 or better
The share buyback program being executed by the company is expected to provide support for the share price. Under the current buyback program, the company has already repurchased 11,462,533 shares and has approval to buyback a maximum of 22,870,00 shares. So, plenty more buying to come from the company should help support the share price if we run into any pull back.
TRADE ACTION
Current position: 2,000 shares
Take profit: Sell 700 shares at $2.25 or better
Stop Loss: Increase from $1.50 to $2.10 Target: No target price
