58.com Inc. (NYSE: WUBA) shares rose yesterday on lighter trade volume than normal after more analysts initiated coverage on the stock.
Analysts at Deutsche Bank AG initiated coverage on 58.com Inc. (NYSE: WUBA) stock, starting the company at Buy. With a rating of Buy on the shares, the company has a 52-week high of $70.27. A number of other analysts have spoken on the stock in recent days, and 58.com Inc. has earned a consensus one-year price target of $61.11, above the opening price of $48.50, a difference of 12.73 percent. After beginning or initiating coverage, analysts and brokerage firms will subsequently publish periodic updates. Changes in price targets are not unheard of.
Meanwhile, the Dow Jones Industrial Average DJIA, +0.62% finished up 112.58 points, or 0.6%, at 18,281.03 yesterday.
The Nasdaq Composite Index COMP, +0.50% rose 26.36 points, or 0.5%, to end at 5,316.02, and is up 0.1% for the week to date.
The S&P 500 index SPX, +0.43% added 9.24 points, or 0.4%, to close at 2,159.73.
58.com Inc. (NYSE: WUBA) shares last traded at $48.00, which is a jump of $0.48 or 0.01 compared to the previous closing price. Opening at $48.50, they varied from $47.95 and $48.58 throughout the day.
58.com Inc. (NYSE: WUBA) currently has a market cap of 6.92B.
58.com Inc.Trading Volume
The stock’s average daily volume is 1,622,170 shares out of a total float 81,797,000 and some 711,179 shares crossed the trading desk yesterday, lower than the norm. Trading volume is likely to increase in the next few days as swing traders often use increases in trading volume to identify large volume aggregation or circulation by institutional investors.
While higher trading for one day will not mean much, conversely, a trend of heavy trading volume on the buy side over a period of days or weeks expresses a positive indicator to market traders that institutions may be moving in, so institutional sponsorship is critical.
Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.
Institutional investors such as these have teams of analysts researching thousands of stocks, so it is good corroboration to see them buying a stock you are considering.
58.com Inc. 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.
Traders can make smarter trades when they follow the activity of professional investors.
Trades for 58.com Inc. (NYSE: WUBA) have ranged from $42.57 – 70.27, and the stock now has a 50-day MA of $47.59 and 200-day MA of $50.52. Today’s last price is 0.32% below the 52 week high of $70.27.
Indeed, earnings growth is among the most critical things to look at in regards to stock investing and, accordingly, investors seek companies that have grown their earnings at least 25% or more over a 3 year period.
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