PAST MULTIBAGGER STOCKS
Understanding the relation of EPS
And Multi year Trend reversals
WHAT IS EPS ?
https://www.investopedia.com/terms/e/eps.asp
RELATION WITH TREND REVERSALS
For a stock price to move up it requires demand
Demand is created when earnings of a company
increase / improve .
Change in EPS trend ( negative to positive ) creates
demand for a stock .
This generally leads to multi year breakout – multi
year trend reversals which push the stock price 3-4x
HOW TO ANALYSE CHARTS :
We used Stage analysis to mark the long term
trend of a stock
Wait for Stage 1 Breakout
Volume on right side of base > Left side of base
30 weekly EMA to understand trend
52 week Relative Strength turns positive after
many years
Wait for positive EPS
IMAGICAA
Imagica has been a loss making from 10 years
until 2022
Its EPS was negative and stock was in Stage 4
downtrend
In June 2023 it reported its first positive EPS
Stock broke out at 25rs even before positive EPS
reported and from that price 3xed and from the time
+ EPS reported Stock Doubled
WONDERLA
Imagica and Wonderla Broke out together , where
wonderla reported + EPS while Imgicaa didn’t
Both belonged to same sector ( Entertainment Parks )
while one reported + Eps other didn’t
I guess market knew that imagicaa will report +
earnings hence it broke out and made a move
Wonderla reported Positive EPS with Stage 1 BO
and RS +
Stock 3xed from breakout level without
breaching 30 wema
MRPL
Loss making for 4 years and reported profits for the
first time in Feb 2022
MRPL with Chennai Petro , both broke out together !
Again same sectors breaking out with + Earning
indicating change in cycle
In this case Earnings were reported and then the
breakout happened in both Stocks .
During that time both midcap and smallcap stocks
where in correction mode , hence this could be a reason
why these stocks didn’t breakout before the earnings or
with the earnings
MRPL
CHENNAI PETRO
SDBL
Sometimes the Losses reducing is also a good sign and
factors that the company may report good earnings in
future
EPS+ was in july but breakout happened in March .
The losses were consistently decreasing probably
boosting the price up
SDBL
After breakout Stock 5xed from the Stage 1
Currently Stock has reached Stage 3 and may see
a distribution period
ENIL UFO AND SHEMAROO
All of the three stocks broke out in Jan 2024
All 3 stocks belonged to entertainment Sector
ENIL had reported the highest positive earnings
among 3 while shemaroo still reported Loss
Shemaroo reversed from the breakout while ENIL
moved up 40% from the first breakout level
UFO reported + earning but muted + hence this stock
is still near breakout level
All 3 stocks again broke out before earnings period
ENIL
UFO
SHEMAROO
ANALYSIS
While all 3 stocks broke out togther Shemaroo reported
a Loss after + Eps in last few quarters while reverse
happened with other 2 stocks from same sector
It is important to buy near the stage 1 breakout or wait
for fresh base formations after breakout if you have
missed the main entry
I have entered ENIL and UFO while I didn’t buy
Shemaroo as it already had positive EPS during the
breakout
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