TACO: Restaurant and retail names have been taking it on the chin lately, no surprise since the economy has been showing signs of weakening. The jobs market has been strong but we know that cannot carry the entire economy on its back, nor can the Fed with their generous monetary policy. However, there is always the case of the ‘haves vs the have nots’, and by the look of its chart we can see Del Taco (TACO) is one of those must ‘have’ names.
After putting in a bottom in midsummer TACO made a nice series of higher highs and higher lows on its way to a visit with the 200 ma. A pop over that level then a classic retest and it was ready for a monster move, up nearly 20% since. The uptrend is intact, a MACD buy signal just renewed on Monday and money flow is very strong. Turnover was solid this week and earnings were out Monday, as the chart foretold the earnings beat estimates.
We like this stock for a move toward 15 or so but if it pulls back to the trend line that could be a nice buying opportunity.
