Texas Roadhouse (TXRH) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, TXRH crossed above the 20-day moving average, suggesting a short-term bullish trend.
The 20-day simple moving average is a popular trading tool. It provides a look back at a stock's price over a 20-day period, and is beneficial to short-term traders since it smooths out price fluctuations and provides more trend reversal signals than longer-term moving averages.
Similar to other SMAs, if a stock's price moves above the 20-day, the trend is considered positive, while price falling below the moving average can signal a downward trend.
TXRH could be on the verge of another rally after moving 11.5% higher over the last four weeks. Plus, the company is currently a Zacks Rank #3 (Hold) stock.
The bullish case only gets stronger once investors take into account TXRH's positive earnings estimate revisions. There have been 4 revisions higher for the current fiscal year compared to none lower, and the consensus estimate has moved up as well.
With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on TXRH for more gains in the near future.
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Texas Roadhouse, Inc. (TXRH): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).