Why Covenant Transportation Group, Inc. (CVTI) Stock Suddenly Retreated Today

Big changes are happening at Covenant Transportation Group, Inc. (NASDAQ:CVTI), which makes the stock worth watching today. The company is among the top losers of the stock market today, sinking -9.16% or (-1.96 points) to $19.44 from its previous close of $21.4. Does this decline mean it the best stock to buy right now? The shares seem to have an active trading volume day with a reported 238262 contracts so far this session. CVTI shares had a relatively better volume day versus average trading capacity of 119.17 thousand shares, but with a 10.06 million float and a -6.88% run over a week, it’s definitely worth keeping an eye on. The one year price forecast for CVTI stock indicates that the average analyst price target is $28 per share. This means the stock has a potential increase of 44.03% from where the CVTI share price has been trading recently which is between $21.25 and $22.07. There are some brokerage firms that offer lower targets than the average, with one of them, even setting their price target at $18.

The shorts are climbing into Covenant Transportation Group, Inc. (CVTI) stock. The latest set of short interest data was released on 28 February 2019, and the numbers show a rise in short interest in CVTI shares. While short interest still represents only 6.59% of CVTI’s float, the number of shares shorted have risen by 20413. The number of shares shorted advanced to 663072 shares, up from 642659 shares during the preceding fortnight. With average daily trading volumes at 106024 shares, days to cover increased to about 6.175079 days.

During the recent trading session for Covenant Transportation Group, Inc. (NASDAQ:CVTI), the company witnessed their stock drop by $-3.25 over a week and tumble down $-4.85 from the price 20 days ago. When compared to their established 52-week high of $35.19, the high they recorded in their recent session happens to be lower. Their established 52-week high was attained by the company on 06/13/18. The recent low of $18.13 stood for a -44.76% since 12/24/18, a data which is good for most investors who are looking to take advantage of the stock’s recent rise. A beta of 1.63 is also allocated to the stock. Since the beta is greater than one, it implies that the stock is more volatile than the market, a data that traders are keeping close attention to.

Looking at the current readings for Covenant Transportation Group, Inc., the two-week RSI stands at 21.77. This figure suggests that CVTI stock, for now, is overbought, meaning that the shares are not stable in terms of price movement. The stochastic readings, on the other hand, based on the current CVTI readings is similarly very revealing as it has a stochastic reading of 4.14% at this stage. This figure means that CVTI share price today is being overbought.

Technical chart claims that Covenant Transportation Group, Inc. (CVTI) would settle between $21.9/share to $22.39/share level. However, if the stock price goes below the $21.08 mark, then the market for Covenant Transportation Group, Inc. becomes much weaker. If that happens, the stock price might even plunge as low as $20.75 for its downside target. The stock is currently in the red zone of MACD, with the indicator reading -1.14. Traders are always alerted for the move of a stock above or below the zero line due to the fact that the reading is an indicator of the position of the short-term average relative to the long-term average. If the MACD is above the zero line, then the short-term average relative is above that of the long-term average, thus implying an upward momentum. Vice versa is the case if the MACD is below the zero line.

Analysts at Cowen lifted target price for shares of CVTI but were stick to Market Perform recommendation for the stock in their opinion released on March 19. The price target has been raised from $27 to $23. Cowen analysts again handed out a Market Perform recommendation to Covenant Transportation Group, Inc. (NASDAQ:CVTI) stock but they lifted target price for the shares in a flash note issued to investors on October 25. The target price has been raised from $36 to $32. Analysts at Wolfe Research lowered the stock to a Underperform call from its previous Peer Perform recommendation, in a research note that dated back to October 05.

CVTI equity has an average rating of 2.4, with the figure leaning towards a bullish end. 5 analysts who tracked the company were contacted by Reuters. Amongst them, 1 rated the stock as a hold while the remaining 4 were split even though not equally. Some analysts rate the stock as a buy or a strong buy while others rated it as a sell. 3 analysts rated Covenant Transportation Group, Inc. (NASDAQ:CVTI) as a buy or a strong buy while 1 advised that investors should desist from purchasing the stock or sell them if they already own the company’s stock.

Moving on, CVTI stock price is currently trading at 8.7X forward 12-month Consensus EPS estimates, and its P/S ratio is 0.44 while for the average stock in the same group, the multiple is 1.62. Covenant Transportation Group, Inc. current P/E ratio of 9.31 means it is trading at a discount against its industry’s 42.07. In the past 5 years, this ratio for the stock has been fluctuating between 8.22 and 34.46.

Covenant Transportation Group, Inc. (CVTI)’s current-quarter revenues are projected to climb by nearly 25.45% to hit $217750, based on current Zacks Consensus Estimate. The firm’s full-year revenues are expected to expand by over 13.52% from $885460 to a noteworthy $1.01 billion. At the other end of the current quarter income statement, Covenant Transportation Group, Inc. is expected to see its adjusted earnings surge by roughly 50% to hit $0.36 per share. For the fiscal year, CVTI’s earnings are projected to climb by roughly 6.36% to hit $2.51 per share.