Even though the market is again experiencing turbulence,Copa
) is consolidating rather steadily.
The stock corrected 13% from its May peak, which fits the bill
for a flat base. But the structure could also be a cup-type
In the current six-week-old pattern, Copa has managed to close
near its highs in four weeks, which shows strength. Another
positive is that the stock regained its 50-day moving average on
Wednesday -- its busiest day of trading in more than a month.
Copa's Accumulation-Distribution Rating is a D, which is not
ideal. But this gauge of institutional demand has improved from a
worst-possible E earlier this month.
The airline industry group has cruised higher in recent
months, thanks to sliding oil prices. In Monday's IBD, the group
ranked No. 13 out of 197, up from 22nd three weeks ago. The group
is up about 18% for the year, while oil prices have tumbled more
Copa -- which is based in Panama and serves the Americas and
Caribbean -- is not a lone ranger in the airline group.Allegiant
) andSpirit Airlines (
) are other highly rated stocks in the group.
The Panamanian air carrier has delivered profit growth each
year since 2002.
Earnings have more than doubled since 2005. Since 2002, sales
growth has mostly been in double-digits, but revenue fell 3% in
Copa has a three-year Earnings Stability Factor of 4,
signaling a steady stream of profits. Analysts polled by Thomson
Reuters see profit rising 13% to $8.01 a share this year. But the
estimate has recently been lowered.
While most companies pay shareholder dividends on a quarterly
basis, Copa does it only once a year. The company pays an annual
dividend of $2.10 a share, which works out to an annualized yield
of about 2.5%.
Its yield is among the highest of the seven dividend-paying
companies in its group. The stock's yield is also roughly the
same as that of the S&P 500.
The company has a policy to pay out up to 30% of its net
income as dividends. But this can change depending on its