For his second "Executive Decision" segment of Mad Money Monday night, Jim Cramer spoke with Rob LoCascio, chairman and CEO of LivePerson Inc. (LPSN) the conversational commerce company with shares up 51% in just the past week.
LoCascio said the death of the call center has finally come now that Covid-19 has forced call centers to close. Companies are moving to digital and messaging customer service options faster.
Packed call centers just don't work in an era of social distancing, Locascio explained. Companies need automated options and that's what LivePerson provides.
Let's check out the charts of LPSN from a safe distance.
In the daily bar chart of LPSN, below, we can see that the stock has had a roller coaster ride the past few months. Prices gapped sharply lower in February and quickly plunged from $44 to just $14 by the middle of March. Prices recovered into April and then this month they gapped higher and rallied to the slightly declining 200-day moving average line. The rally has been strong enough to turn the slope of the 50-day moving average line positive now.
The daily On-Balance-Volume (OBV) line made a low in March and shows gains, which tells us that buyers of LPSN have been more aggressive. The trend-following Moving Average Convergence Divergence (MACD) oscillator gave a cover shorts buy signal in late March and an outright buy signal this month.
In the weekly bar chart of LPSN, below, we can see that prices have done well over the past three years and the decline this year is not all that bad as the lows of late 2018 were only briefly broken. Prices have rallied back to test the declining 40-week moving average line.
The weekly OBV line is slowly improving and the MACD oscillator has crossed to a cover shorts buy signal on this time frame.
In this first Point and Figure chart of LPSN, below, we used daily price data to construct the X's and O's. Here the chart shows that prices have reached an upside price target in the $32 area.
In this second Point and Figure of LPSN, below, we used weekly price data and a longer-term price target of $62 is being projected.
Bottom-line strategy: It looks like LPSN can rally further but the issue is where to go long. Prices could just continue higher but I suspect patient traders might be able to go long around $32 and then risk below $28. The price targets are $44 and then $62.