This $7 Billion Stock Has Solid Technicals and Could Gain More Than 120% from Here

• Descartes Systems (DSGX) is a $7.3B software-as-a-service logistics leader showing strong technical momentum and positive analyst sentiment.
• DSGX has a 100% “Buy” technical opinion from Barchart.
• Revenue is projected to grow 13.95% this year and 12.84% next year, with earnings estimated to rise 20.74%.
• Analyst price targets range from $89 to $200, with the consensus above current levels and profitability metrics remaining robust.

Today’s Featured Stock

Valued at $7.3 billion, Descartes Systems (DSGX) is a leading provider of software-as-a-service logistics solutions. It is delivering results across the globe today for organizations that operate logistics-intensive businesses. Descartes’ solutions and services help its customers reduce administrative costs, billing cycles, fleet size, contract carrier costs, and mileage driven and improve pick-up and delivery reliability. 

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals and superior current momentum. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. DSGX checks those boxes. The Trend Seeker issued a new “Buy” signal on Oct. 9. Since that signal, shares are up 6.78%.

Barchart’s Technical Indicators for Descartes Systems

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Descartes Systems hit a 6-month high of $89.12 on Oct. 15.

• Descartes has a Weighted Alpha of 3.87.
• DSGX has a 100% “Buy” opinion from Barchart.
• The stock has lost 8.55% over the past 52 weeks.
• Descartes has its Trend Seeker “Buy” signal intact.
• The stock recently traded at $88.52 with a 50-day moving average of $79.27.
• DSGX had 9 highs and gained 10.89% in the last month.
• 60-month beta of 0.65
• Relative Strength Index (RSI) is at 71.33.
• There’s a technical support level around $84.42.

Don’t Forget the Fundamentals

• $7.3 billion market capitalization.
• 39.66x trailing price-earnings ratio.
• Revenue is expected to grow 13.95 this year and another 12.84% next year.
• Earnings are estimated to increase by 20.74% next year.

Analyst and Investor Sentiment on Descartes Systems

• Wall Street analysts followed by Barchart give the stock 11 “Strong Buy,” 2 “Moderate Buy,” and 2 “Hold” opinions with price targets from $89 to $126.
• Value Line rates the stock “Above Average” with price targets from $135 to $200.
• Morningstar thinks the stock is 5% undervalued.
• CFRA’s MarketScope rates the stock as “Hold.”
• 4,230 investors are following the stock on Seeking Alpha, which rates it as a “Hold.”
• TipRanks’ analysts have a consensus of $103.29, which is above yesterday’s close.
• Short interest is 4.61% of the float with 6.32 days to cover the float.

The Bottom Line on Descartes Systems

Analysts have positive opinions on the Descartes Systems. The stock shows outstanding profitability, solid growth metrics, and a favorable trend in analyst revisions. 

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio, it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.

On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.