Will Interactive Find a Match Between Traders and Its Oversold Shares?
From Ask.com to Match.com, ^IACI^ has been one of the leading content providers on the Internet for the average consumer. While high-powered users of the Web may scoff at the pedestrian quality of the IAC line of websites, online destinations like Dictionary.com and Urbanspoon form a growing part of the path that millions of web surfers travel every day.
And if the recent progress in the stock is any indication, this has been a good business for IAC. Shares of the company’s stock rallied to their highest levels of the year last week. And in the days since, traders and investors in IACI have taken the opportunity of near-52-week highs to take profits and lock in gains.
The profit-taking in IACI has taken the stock down for four days in a row, with IACI losing more than 1% in Monday’s session. The four straight days of selling, however, have relocated the stock in oversold territory above the 200-day moving average.
The last time shares of IACI was trading at similarly oversold levels was shortly after the Thanksgiving holiday at the end of November. Then, a seven-day pullback ending with four consecutive oversold closes paved the way for a rally during which IACI gained for six out of the next seven days, adding well over 7%.
Previous short-term pullbacks in the stock – twice in early November and again in early October – were also met with sharp, snapback rallies.
Heading into trading on Tuesday, shares of IACI continue to earn ratings upgrades to the upper end of our “neutral” range. IACI earned a 5 out of 10 on December 7th, and a 6 out of 10 on the 8th and 9th. The stock is expected to have a rating of 7 out of 10 when trading begins Tuesday morning. Down four in a row, it would still take at least an additional day of selling to put IACI at truly extreme levels where it could earn a “consider buying” rating of 8 out of 10 or higher.
An upgrade to 8 out of 10, by the way, would represent the highest rating in the stock since March 2011. That 8 out of 10 rating came during a sell-off in IACI that threatened a test of the stock’s lowest levels of the year. One day later, shares of IACI embarked on a rally that saw the stock gain for eight out of the next 10 days, earning more than 7%.
The stocks in today’s report were drawn from the data and research available through PowerRatings. To find out more, click here.
David Penn is Editor in Chief of TradingMarkets.com