Positive shift in sentiment
eOH offers a range of information technology services, software, IT infrastructure, industrial technologies and outsourcing solutions. It operates in over 50 countries.
When EOH failed to exceed its first top at 18 000c/share in December 2016, after years of strong growth funded with shares, it gradually dropped to 2 335c/ share – lows last seen in 2012.
Allegations of government tender irregularities, which the company flatly denies, as well as the sudden resignation last year of long-time CEO and founder Asher Bohbot, shocked the market.
The company was expected to release its results for the year to 31 July 2018 on 3 October, as this edition of finweek went to print. Outlook: EOH has retained firm support at 2 655c/share and seems to be bottoming-up within its long-term bear trend – potentially spurred by the company’s overhaul strategy. Shareholders are also welcoming the appointment of Stephen van Coller as CEO – he was previously MTN Group vice-president for digital services, data analytics and business development. On the charts: The company’s share price is edging closer to the resistance trendline of its longterm bear trend. If another rising bottom forms above 2 655c/share, further gains may be in the offing. Go long: A good buy signal would only be triggered through 5 500c/ share – above that level EOH would also confirm a positive breakout of its long-term bear trend. Gains to next resistance at 7 745c/share should then follow. If upside momentum were to persist after the breakout, EOH could retest the 11 750c/share level in the short to medium term.
Go short: Do not go long if EOH should fail to breach the blue bold trendline – the share price could fall back to 2 655c/share.
The bear trend would extend through that level, towards 1 800c/share. ■