Credit Corp (CCP) provides debt purchase and collection services. (CCP) mainly focuses on acquiring debt ledgers and operates in both Australia and the US.
“We believe there is upside risk to their earnings, and the valuation at these levels doesn’t look too demanding,” Michael said.
“The chart, however, is very interesting. It seems to have developed some very clear levels which will tell us when it is time to start buying again. The overall charting pattern for CCP looks bullish, but it is not ready to buy just yet.
“Since peaking 12 months ago, just under the 2020 high, it has been trading sideways to form an ascending triangle.
“Consolidating like this under the 2020 high is a bullish sign as the stock works through all the sellers and sets itself up for a clear run to a new high.
“What we need to do now is wait for an upside break.
“A weekly close above $35 would be the buy trigger.
“If that were to occur, then we should expect to see a multi-month rally into new highs.
“TPG shares currently look cheap at these levels.
“We also expect a more sustainable earnings recovery from here, which should see a re-rating in the share price.
“The chart is also indicating that current levels are a buying opportunity.
“After easing back across October to early December, TPG then spent the following few weeks forming a base just under $6.
“The range also started to tighten up.
“A tightening trading range usually precedes a strong move in one direction or the other.
“Last week we saw it break higher on strong volume.
“This indicates that a low is in place and the share price is likely to follow through to the upside from here.
“I expect a recovery to at least $7 in the short term,” Michael said.
Credit Corp Limited (CCP)
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