El Paso Electric Company (EE) stock falls, “Hold” rating reaffirmed by Jefferies Group LLC Analysts

El Paso Electric Company (NYSE: EE) shares fell on Tuesday February 14 on lower trade volume than normal after a number of analysts weighed in on the investing value of the stock and reiterated thier respective ratings.

Meanwhile U.S. stocks opened slightly lower on Tuesday. The main three benchmarks retreated after touching the latest in a series of record highs on Monday, with the S&P 500 index SPX, -0.09% down two points, or 0.1%, to 2,326.

The Dow Jones Industrial Average DJIA, -0.02% fell 34 points, or 0.2%, to 20,381. The Nasdaq Composite Index COMP, -0.13% shed eight points, or 0.1%, to 5,756.

Jefferies Group LLC analysts reiterated its Hold rating on El Paso Electric Company (NYSE: EE) in a note to investors, making it one of the more closely watched stocks on Wall Street. With a rating of Hold on the stock, the company has a 52-week high of $48.75. A number of other analysts have commented on the stock recently, and El Paso Electric Company has earned a consensus one-year price target of $48.50, higher than the opening price of $46.50. Usually, after analysts issue a “reiterated rating” report on a stock, they will subsequently issue periodic revisions, usually followed by a price target change.

Yesterday El Paso Electric Company (NYSE: EE) shares last traded at $46.35, a decrease of $0.30 compared to the previous closing price. Opening at $46.50, they fluctuated from $46.20 and $46.50 throughout the day.

El Paso Electric Company (NYSE: EE) currently has a market cap of 1.88B.

El Paso Electric Company (NYSE: EE) Average Daily Trading Volume

9,119 shares traded hands yesterday, 17 percent lower than the average, out of a total float 39,941,000. lower than normal. Look for trading volume to pick up in the coming days as investors often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.

As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.

Institutional sponsorship just refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.

Institutional investors such as these have substantial teams of analysts researching thousands of stocks, so it is good corroboration to see them taking a postion in a stock you are considering.

El Paso Electric Company (NYSE: EE) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By tracking the activity of these professional investors—and the moving averages they affect—it allows for traders to make more effective decisions on trades.

Trades for El Paso Electric Company (NYSE: EE) have ranged from $39.37 – 48.75, and the stock now has a 50-day MA of $46.14 and 200-day MA of $45.85. Today’s last price is 4.92%% lower than the 52 week high of $48.75.

Earnings growth is a critical factor to consider when buying stocks and investors seek companies that have raised their earnings at least 25% or more over 3 consecutive years.

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