IKON Office Solutions (IKN)

Company

IKN 1-year chart IKN 1-year chart

"IKON Office Solutions, Inc. is the world's largest independent channel for document management systems and services, enabling customers worldwide to improve document workflow and increase efficiency. IKON integrates best-in-class copiers, printers and MFP technologies from leading manufacturers, such as Canon, Ricoh, Konica Minolta, and HP, and document management software and systems from companies like Captaris, Kofax, EFI, eCopy and others, to deliver tailored, high-value solutions implemented and supported by its global services organization - IKON Enterprise Services. With fiscal year 2007 revenue of $4.2 billion, IKON has approximately 25,000 employees in over 400 locations throughout North America and Western Europe." (company website)

IKN 6-month chart
IKN 6-month chart

Buy

22-May-08. IKON has been trending down since the beginning of 2007, and at the beginning of 2008 the decline became rapid and deep. It appears, however, that the bottom was reached at the beginning of March; since then it has crossed above the 50- and 200-day moving averages, and the price has nearly doubled. For three weeks now it has been consolidating below $12.

  • Price momentum (PPO) — increasing since February, although it has slowed during the consolidation
  • Relative strength (RSI) — very strong, near or above 70 for six weeks
  • Trend (ADX) — very strong; buying pressure (+DI) has fallen off, but there has been no corresponding increase in selling pressure (-DI)
  • Volume — has gradually fallen since February

Based on technical analysis, MarketEdge calls IKN a "strong buy" in a "strong upward trend."

Sell

gain Bottom line
9%

25-Jul-08. A week ago, IKN raised their earnings estimate, which gave the stock a big boost. When they reported yesterday, the $.34 they reported outstripped the expected $.30; the brief flurry in buying quickly washed out, since the good earnings report had been priced in already.

IKN is now over-bought, and I would expect a pullback in the near future. Rather than wait for that to happen, I decided to lock in profits today.