DRDGOLD LTD-SPONSORED ADR (NYSE:DRD) Emerges as a Top CAN SLIM Candidate

The CAN SLIM investment strategy, created by William O’Neil, uses fundamental and technical analysis to find high-growth stocks with solid momentum. This approach highlights earnings acceleration, institutional sponsorship, and relative strength, with other factors, to find market leaders ready for major price gains. One stock that recently appeared from a CAN SLIM screen is DRDGOLD LTD-SPONSORED ADR (NYSE:DRD), a firm focused on the retreatment of surface gold tailings in South Africa.

Earnings and Sales Growth
A main idea of the CAN SLIM system is solid quarterly earnings and sales growth, which shows operational momentum and market need. DRD shows very good performance here:

• Quarterly EPS growth year-over-year: 203.09%
• Quarterly revenue growth year-over-year: 141.26%

These numbers are much higher than O’Neil’s proposed minimum of 20–25% growth, showing solid operational performance and good conditions in the gold retreatment field.

Annual Earnings and Profitability
The “A” in CAN SLIM calls for important annual earnings increases and high profitability. DRD’s fundamentals fit well here:

• 3-year EPS CAGR: 25.64%
• Return on Equity (ROE): 36.17%

A maintained history of earnings growth and a high ROE are signs of well-run companies with an advantage, important features wanted by CAN SLIM investors.

New Highs and Relative Strength
The strategy focuses on buying stocks as they reach new highs, backed by solid relative strength, which indicates market leadership. DRD now shows:

• Relative Strength: 96.46 (performing better than 96% of all stocks)
• Trading near 52-week highs

This technical strength points to wide market recognition and fits with the CAN SLIM focus on momentum and timing.

Supply, Demand, and Institutional Sponsorship
Low debt, good trading volume, and reasonable institutional ownership are also key in the CAN SLIM framework. DRD has a good profile in these areas:

• Debt-to-Equity Ratio: ~0.001
• Institutional Ownership: 15.02%

The very low debt level lowers financial risk, while the modest institutional ownership suggests potential for more institutional buying, a possible driver for additional price gains.

Market Direction and Overall Ratings
With both short- and long-term trends for the S&P 500 positive, the wider market setting is good for growth-focused strategies like CAN SLIM. DRD’s technical rating of 10/10 shows solid price action and trend steadiness, and its fundamental rating of 7/10 points to high profitability and fair valuation, even with more average expected future growth.

Conclusion
DRDGOLD LTD-SPONSORED ADR displays several traits that fit the CAN SLIM investment method, including very high quarterly growth, strong profitability, good relative strength, and a positive debt profile. While the company works in a cyclical field and future growth projections are cautious, its present fundamental and technical strength makes it an interesting candidate for more study by growth-oriented investors.

For more stocks that fit this strategy, see the CAN SLIM screener.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own research and consider their financial situation before making any investment decisions.