SIA Charts’ relative strength rankings assist investors in identifying stocks that are outperforming their peers or index benchmarks. Outperformance typically indicates positive investor expectations for a company or sector. The rankings not only help investors to identify which stocks in a universe are outperforming and underperforming against their peers, but also when relative performance trends are changing. Today we are going to highlight a Wholesale name in the Drug area exhibiting outperformance of late. To illustrate this strength, let’s review the shares of Cencora Inc. (COR) which is a constituent of the S&P 500 Index. COR currently occupies the 74th spot out of 505 positions in the SIA S&P 500 Index report and is showing consistent strength of late up 19 spots in the last week, 67 spots on the last month, and 50 spots in the last quarter. It entered the favored zone of the report back on March 8, 2025, at a price of $253.77. Today, the shares are at $332.71 as of Friday’s close which represents a 31% increase in a little over 6 months time. This exemplifies the example of always looking for names in the favored zone as that is where the strength lies.
In looking at the attached candlestick chart of COR, the shares primarily have trended upwards from October of 2022 to the Spring of 2024. This was followed by a sideways consolidation pattern from that point until early 2025 with the $215.00 area as the lower range and $255 on the upper range of this sideways pattern. Beginning in March of this year, the shares broke above this range and a new uptrend materialized with the shares continually reaching all time highs. If the shares pause to digest its gains, support may be found at the $290 area while resistance would be found at approximately the $350.00 Area. Only time will tell which direction the shares will continually migrate towards.
The benefit of looking at Point and Figure Charts is you can see more precisely upcoming support and resistance points. In looking at the Point and Figure chart at a 2% scale for an investment grade analysis, we see the shares have indeed trended in a sideways consolidation pattern between March of 2024 to February of 2025 before a confirmed break out occurred at the $252.96 price point in March of this year. This breakout lasted until May when the shares reached $302 before another sideways trend formed lasting four months when a new upleg formed as the shares closed above $308.35 last month. In looking at the point and figure chart, we see potential resistance quickly forthcoming at the $340.45 level based on a measured move. To the downside, support is at its 3 box reversal of $302.31 which is also when the shares broke past its prior resistance point. Below that, next support is at $273.81. The shares currently exhibit a bullish Spread Double Top pattern and with an SMAX score of 9 out of 10, Cencora is exhibiting strong near term strength against the asset classes. Cencora Inc., formerly known as AmerisourceBergen, is an American drug wholesale company that was formed by the merger of Bergen Brunswig and AmeriSource in 2001. They provide drug distribution and consulting related to medical business operations and patient services. They also distribute a line of brand name and generic pharmaceuticals, over-the-counter (OTC) health care products and home health care supplies and equipment to health care providers throughout the United States, including acute care hospitals and health systems, independent and chain retail pharmacies, mail-order facilities, physicians, clinics and other alternate site facilities, as well as nursing and assisted living centers.
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