EMCOR Group, Inc. (EME)

Emcor Group is a construction and infrastructure company based out of Connecticut, USA. It provides mechanical and electrical construction, industrial and energy infrastructure, and facilities services to commercial, industrial, utility, and institutional customers. Its contracts are generally for large installation projects worth millions of dollars. The construction sector in general has underperformed for many years and is poised for a recovery post the pandemic. EMCOR, being one of the largest players in the sector, is therefore well-placed for long term growth.

The long term monthly chart for Emcor shows a consistent uptrend over the last decade. The $58-level, , has proved to be an important support level since 2017. Recently, from December 2019 to March 2020, the stock fell by a significant 54% over 4 consecutive months of lower closes.

In April, however, the stock bounced back up from the $58 support level and the price has since gained about 28%. This month, the price has crossed a crucial support-resistance zone at $72 and now looks poised to test the $93-level. A long position at this moment provides a healthy risk-reward ratio with a stop loss somewhere below the August low of $69.

Positions taken today at $76.1 with stop Loss 23% below. With medium term take profit set at $95 giving a 25% return.