Extended Stay America Inc. (STAY) stock down despite upgrade at Zacks Investment Research

Zacks Investment Research (Extended Stay America Inc.: NYSE) shares slid back in value Wednesday Dec 28 with slower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a upgraded rating.

Meanwhile, U.S. stocks were little changed on Wednesday, as investors found few reasons to keep pushing shares higher towards the 20,000 mark.

The Dow Jones Industrial Average DJIA, -0.11% rose 3.1 points to 19,949, essentially unchanged on the day. The S&P 500 SPX, -0.39% lost 3 points, or 0.1%, to 2,266 while the Nasdaq Composite Index COMP, -0.59% slipped 6.4 points, or 0.1%, to 5,482.

Analysts at Zacks Investment Research upgraded shares of Zacks Investment Research (Extended Stay America Inc.: NYSE) from Hold to Buy today. With a rating of Buy on the stock, Extended Stay America Inc. has a 52-week high of $17.08. The one-year price target of $18.04 is above the opening price of $16.22, that has caused a number of other analysts to report on the company in recent days. Share prices sometimes get a boost to the upside when analysts upgrade a stock.

Shares of Zacks Investment Research (Extended Stay America Inc.: NYSE) opened at $16.22 on Tuesday trading between $16.02 and $16.27, and last traded at $16.09, which represents a decrease of $0.09 per share or -0.56% compared to the previous closing price.

Zacks Investment Research (Extended Stay America Inc.: NYSE) currently has a market cap of 3.19B.

Zacks Investment Research (Extended Stay America Inc.: NYSE) Average Daily Trading Volume

The stock’s average daily volume is 1,128,410 shares out of a total float 109,245,000 and some 50,370 shares traded hands yesterday, lower than normal. Trading volume is likely to increase in the next few days as momentum traders often use increases in trading volume to identify substantial volume aggregation or circulation by institutional investors.

However, one day of significant buy side trading is not enough to affirm a trend. So market traders will continue to watch for institutional sponsorship as an indicator that financial institutions are moving forward.

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

These instituitional investors retain teams of analysts that investigate thousands of stocks, so it is good corroboration to see them buying a stock you’re considering.

Zacks Investment Research (Extended Stay America Inc.: NYSE) 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 spotting trends, moving averages allow traders to make those trends work in their favor and increase the number of winning trades.

With that in mind, Zacks Investment Research (Extended Stay America Inc.: NYSE) now has a 50-day MA of $15.86 and 200-day MA of $14.73. It has traded in a 52-week range between $10.56 – 17.08 and today’s last price is 5.80%% lower than the 52 week high of $17.08.

Earnings growth is a crucial factor to consider when investing in stocks and investors watch for companies that have increased their earnings at least 25% or more for 3 consecutive years.

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