# 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:

Y_{i} = α + β × X_{i} + ε_{i}

Top border of price channel:

Exp(Y_{i}) = Exp(a + b × X_{i} + 2 × s)

Bottom border of price channel:

Exp(Y_{i}) = Exp(a + b × X_{i} – 2 × s)

where:

i - observation number

Y_{i} - natural logarithm of ASTE price

X_{i} - time index, 1 day interval

σ - standard deviation of ε_{i}

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(Y_{447})

= Exp(a + b × X_{447} + 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(Y_{447})

= Exp(a + b × X_{447} – 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(Y_{1,081})

= Exp(a + b × X_{1,081} + 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(Y_{1,081})

= Exp(a + b × X_{1,081} – 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(Y_{767})

= Exp(a + b × X_{767} + 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(Y_{767})

= Exp(a + b × X_{767} – 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(Y_{1,181})

= Exp(a + b × X_{1,181} + 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(Y_{1,181})

= Exp(a + b × X_{1,181} – 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.