In his first Executive Decision segment of last Friday's "Mad Money" program, host Jim Cramer spoke with Tim Boyle, chairman, president and CEO of Columbia Sportswear (COLM) , an outdoor apparel maker that last week reported a big fourth-quarter earnings beat.
Boyle acknowledged that Columbia is seeing supply chain disruptions around the globe, but he said the company has done everything it can to mitigate them and was able to deliver fantastic earnings.
When asked about those earnings, Boyle said consumers were smart and bought early last year, leading to fewer promotions and higher gross margins. Columbia also slowed its online sales to help support retailers and ensure they had all the inventory they needed this winter.
Let's check out Columbia's charts again. The last time we tried on the charts of COLM was way back on Aug. 19, 2020.
In this updated daily bar chart of COLM, below, we can see that prices have traded lower since late April. Prices are trading below the declining 200-day moving average line and testing the declining 50-day line. The On-Balance-Volume (OBV) line shows on-and-off weakness from April as traders have been more aggressive sellers than buyers. The Moving Average Convergence Divergence (MACD) oscillator has crossed to a cover shorts buy signal but remains below the zero line.
In this weekly Japanese candlestick chart of COLM, below, we see a less-than-positive picture. Prices are trading below the declining 40-week moving average line, so the intermediate term trend is bearish. The most recent candle is white (bullish) but shows an upper shadow as traders rejected the highs of the week. The OBV line shows weakness from April and the MACD oscillator is bearish.
In this daily Point and Figure chart of COLM, below, we can see a potential upside price target of $106.
In this weekly Point and Figure chart of COLM, below, we can see a downside price target of $79. A bounce and then a decline?
Bottom line strategy: The charts and indicators of COLM do not yet show a clear path higher for prices. We could see COLM bounce further to the upside in the short run, but the clues point to further declines in the weeks ahead. Avoid the long side of the stock but consider purchasing the products.