Looking Good: A Fresh Look at Estee Lauder

Here are our new price targets.

In our last review of Estee Lauder (EL) on Feb. 8 I wrote that, "I don't normally chase after a stock that has gapped higher. I like to see a bit of sideways trading to see what sort of sell stop to recommend and see how aggressive traders might be on profit taking. Buyers should risk to $259 now but if support develops around $270 and EL moves higher then a closer stop could be recommended. $300 and then $360 are the price targets."

Action Alerts PLUS holding EL has reached our $300 price target so an update seems in order. 

In the daily bar chart of EL, below, we can see that prices gapped lower at the beginning of May but have quickly stabilized and are poised to rally back above the 50-day moving average line.

The On-Balance-Volume (OBV) has moved higher the past 12 months.The Moving Average Convergence Divergence (MACD) oscillator is below the zero line but could soon cross to a cover shorts buy signal. 

 

In the weekly Japanese candlestick chart of EL, below, we see a constructive picture as there are lower shadows on some of the candles as prices approached the $285 area.

 

The weekly OBV line is bullish and the 40-week moving average line has a positive slope, The MACD oscillator has crossed to the downside but this could be reversed soon as there is not a developed top pattern on the chart. 

 

 

In this daily Point and Figure chart of EL, below, we can see a potential price target in the $392 area.  

 

 

 

Bottom-line strategy: Continue to hold longs and buy more if you are following Cramer's  Action Alerts PLUS. Raise stops to $281 from $259. The $392 area is our price objective after $360.

(EL is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells this stock? Learn more now.)

 

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