Does HESAI GROUP (NASDAQ:HSAI) show the characteristics of a Minervini super stock?

Our stock screener has spotted HESAI GROUP (NASDAQ:HSAI) as a stocks which checks several boxes as specified by Mark Minervini. We will dive into an analysis below.

Checking the Minervini Trend Template.

HSAI checks all the boxes when evaluating the Minervini Trend Template. This is a set of basic technical criteria to identify stocks in strong uptrends:

• ✔ Relative Strength is above 70.
• ✔ Current price is within 25% of it's 52-week high.
• ✔ Current price is at least 30% above it's 52-week low.
• ✔ The current price is above the 50-, 150- and 200-day SMA price line.
• ✔ The SMA(200) is trending upwards.
• ✔ The SMA(150) is above the SMA(200)
• ✔ The SMA(50) is above the SMA(150) and the SMA(200)

Assessing Growth for HSAI

To evaluate a stock's growth potential, ChartMill utilizes a High Growth Momentum Rating (HGM) on a scale of 0 to 10. This assessment considers various growth and profitability aspects, like EPS and revenue growth, accelleration, surprises and revisions. HSAI has achieved a 5 out of 10:

Earnings Momentum

• The EPS of HSAI has exhibited growth from one quarter to another (Q2Q), with a 259.0% increase. This underscores the company's ability to generate higher earnings and improve its financial standing.
• HSAI shows accelerating EPS growth: when comparing the current Q2Q growth of 259.0% to the previous quarter Q2Q growth of 58.02%, we see the growth rate improving.
• Sales acceleration happened 3 quarters in a row.
• HSAI has achieved 102.0% growth in EPS over the past 12 months, reflecting a sustained improvement in earnings performance.
• The recent q2q revenue growth of 28.26% of HSAI showcases the company's ability to generate increasing revenue in a short period, reflecting its positive growth trajectory.
• The sales growth of HSAI is accelerating: the current Q2Q growth of 28.26% is above the previous quarter Q2Q growth of 21.06%. Sales momentum and acceleration are key for high growth systems.
• Sales acceleration happened 3 quarters in a row.
• HSAI has seen a 47.92% change in the average next Quarter EPS Estimate by analysts over the last 3 months, signaling the shifting perception of the company's EPS outlook.
• With a track record of beating EPS estimates 3 times in the last 4 quarters, HSAI showcases its consistent ability to deliver earnings surprises. This reflects the company's strong execution and its competitive position in the market.

Profitability & Financial Strength

• With positive growth in its operating margin over the past year, HSAI showcases its ability to improve profitability through effective cost control and operational efficiency. This growth underscores the company's commitment to enhancing its financial performance.
• HSAI has experienced notable growth in its free cash flow (FCF) over the past year, signaling improved cash generation and strong financial performance. This growth suggests the company's ability to generate excess cash for reinvestment or shareholder returns.
• At a Debt/Equity ratio of 0.09, HSAI seems well-positioned to sustain growth while keeping debt in check.

Institutional Confidence & Market Strength

• HSAI exhibits a favorable ownership structure, with an institutional shareholder ownership of 51.31%. This signifies a diverse investor base, which can contribute to a more stable and efficient market for the stock.
• HSAI has achieved an impressive Relative Strength (RS) rating of 99.41, showcasing its ability to outperform the broader market.

How does the Setup look for HSAI

ChartMill also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, HSAI exhibits a 5 setup rating, indicating its consolidation status in recent days and weeks.

Besides having an excellent technical rating, HSAI also presents a decent setup pattern. Prices have been consolidating lately. There is very little resistance above the current price.

For an up to date full technical analysis you can check the technical report of HSAI

Final Thoughts

It looks like HESAI GROUP meets the Minervini criteria. More high growth momentum breakout stocks can be found in our High Growth Momentum + Trend Template screen.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.