Conclusion, Investment Implications, Strategy
People’s United Financial (PBCT) appears to be resuming its April advance following months of sideways investor indecision. A sustained rise above the upper boundary of the indecision area, currently near $13.04, would target an additional 32% rise to $17.50 per share.
Analysis and Rationale
People’s United Financial, Inc.(PBCT) operates as the bank holding company for People’s United Bank, National Association that provides commercial banking, retail banking, and wealth management services to individual, corporate, and municipal customers. The company operates in two segments, Commercial Banking and Retail Banking. In addition, the company offers online banking, investment trading, and telephone banking services. It operates through a network of 450 branches in Connecticut, southeastern New York, Massachusetts, Vermont, Maine, and New Hampshire, as well as 602 ATMs. The company was founded in 1842 and is headquartered in Bridgeport, Connecticut.
Chart 1 below plots PBCT daily since Q4 2019 and shows that price is currently breaking out higher from months of sideways investor indecision from the April lows. A sustained rise above the upper boundary of the indecision area, currently near $13.04, would target an eventual, additional 32% rise to $17.50 per share.
Table 1 below shows that, considering the aforementioned upside target and a protective stop placed below the $12.65 area, a long entry price of $13.25 would provide a 1:7.1 risk/reward ratio (risking $1.00 to make $7.10) with an initial risk of 4.5%.
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