Stock Price Trends

Astec Industries, Inc. (ASTE)

manufacturer of heavy equipment for the production of asphalt.

Stock Price Trends

Stock price trends estimated using linear regression.

Key facts

  • The primary trend is decreasing.
  • The decline rate of the primary trend is 23.75% per annum.
  • ASTE price at the close of February 16, 2024 was $35.69 and was inside the primary price channel.
  • The secondary trend is increasing.
  • The growth rate of the secondary trend is 7.67% per annum.
  • ASTE price at the close of February 16, 2024 was lower than the bottom border of the secondary price channel by $2.48 (6.49%). This indicates a possible reversal in the secondary trend direction.
  • The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.

Linear Regression Model

Model equation:
Yi = α + β × Xi + εi

Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)

Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)

where:

i - observation number
Yi - natural logarithm of ASTE price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e


Primary Trend

Start date: November 24, 2020
End date: June 5, 2023

a = 4.7580

b = -0.0007

s = 0.1325

Annual growth rate:

Exp(365 × b) – 1
= Exp(365 × -0.0007) – 1
= -23.75%

Price channel spread:

Exp(4 × s) – 1
= Exp(4 × 0.1325) – 1
= 69.90%

November 24, 2020 calculations

Top border of price channel:

Exp(Y447)
= Exp(a + b × X447 + 2 × s)
= Exp(a + b × 644 + 2 × s)
= Exp(4.7580 + -0.0007 × 644 + 2 × 0.1325)
= Exp(4.5445)
= $94.11

Bottom border of price channel:

Exp(Y447)
= Exp(a + b × X447 – 2 × s)
= Exp(a + b × 644 – 2 × s)
= Exp(4.7580 + -0.0007 × 644 – 2 × 0.1325)
= Exp(4.0144)
= $55.39

June 5, 2023 calculations

Top border of price channel:

Exp(Y1,081)
= Exp(a + b × X1,081 + 2 × s)
= Exp(a + b × 1,567 + 2 × s)
= Exp(4.7580 + -0.0007 × 1,567 + 2 × 0.1325)
= Exp(3.8586)
= $47.40

Bottom border of price channel:

Exp(Y1,081)
= Exp(a + b × X1,081 – 2 × s)
= Exp(a + b × 1,567 – 2 × s)
= Exp(4.7580 + -0.0007 × 1,567 – 2 × 0.1325)
= Exp(3.3286)
= $27.90

Description

  • The primary trend is decreasing.
  • The decline rate of the primary trend is 23.75% per annum.
  • ASTE price at the close of February 16, 2024 was $35.69 and was inside the primary price channel.

Secondary Trend

Start date: March 4, 2022
End date: October 26, 2023

a = 3.4674

b = 0.0002

s = 0.0972

Annual growth rate:

Exp(365 × b) – 1
= Exp(365 × 0.0002) – 1
= 7.67%

Price channel spread:

Exp(4 × s) – 1
= Exp(4 × 0.0972) – 1
= 47.50%

March 4, 2022 calculations

Top border of price channel:

Exp(Y767)
= Exp(a + b × X767 + 2 × s)
= Exp(a + b × 1,109 + 2 × s)
= Exp(3.4674 + 0.0002 × 1,109 + 2 × 0.0972)
= Exp(3.8862)
= $48.72

Bottom border of price channel:

Exp(Y767)
= Exp(a + b × X767 – 2 × s)
= Exp(a + b × 1,109 – 2 × s)
= Exp(3.4674 + 0.0002 × 1,109 – 2 × 0.0972)
= Exp(3.4975)
= $33.03

October 26, 2023 calculations

Top border of price channel:

Exp(Y1,181)
= Exp(a + b × X1,181 + 2 × s)
= Exp(a + b × 1,710 + 2 × s)
= Exp(3.4674 + 0.0002 × 1,710 + 2 × 0.0972)
= Exp(4.0078)
= $55.03

Bottom border of price channel:

Exp(Y1,181)
= Exp(a + b × X1,181 – 2 × s)
= Exp(a + b × 1,710 – 2 × s)
= Exp(3.4674 + 0.0002 × 1,710 – 2 × 0.0972)
= Exp(3.6191)
= $37.30

Description

  • The secondary trend is increasing.
  • The growth rate of the secondary trend is 7.67% per annum.
  • ASTE price at the close of February 16, 2024 was lower than the bottom border of the secondary price channel by $2.48 (6.49%). This indicates a possible reversal in the secondary trend direction.