Might Ambac Financial Group Inc. (NASDAQ:AMBC) drown you?


Shares of Ambac Financial Group, Inc. (NASDAQ:AMBC) are currently poised at -1.64% from the open today and are trading at $17.34. More than 989,600 shares have exchanged hands compared to an average trading volume of 393.71K. At the current pps, the market cap stands at $788.62M. The stock prices of Ambac Financial Group, Inc. (NASDAQ:AMBC) are currently trading at -36.37% below its 52 week high and 17.48% above its 52 week low.

Ambac Financial Group, Inc. (NASDAQ:AMBC) has been in the news for all the right reasons. Recently, Ambac Financial Group, Inc. (NASDAQ:AMBC) announced today that, consistent with all previous years since issuance, the Wisconsin Commissioner of Insurance (the “Commissioner”) has disapproved AAC’s and the Segregated Account of AAC’s (the “Segregated Account”) request to pay accrued unpaid interest on senior surplus notes (“Surplus Notes”) issued by AAC and the Segregated Account, respectively, on their next scheduled interest payment date of June 7, 2017.

Ambac Financial Group, Inc. (NASDAQ:AMBC) is all set to announce its earnings on May 10/a. As per Zack’s analyst ratings, Ambac Financial Group, Inc. (NASDAQ:AMBC) currently has an average brokerage rating of 3. On a scale of 1 to 5, a rating of 1 or 2 would indicate a buy, and a rating of 4 or 5 would signify a sell recommendation. A rating of 3 would indicate a hold on the stock. The consensus target price on (NASDAQ:AMBC) is $19 with a high of $28 and a low of $10.

Let’s take a look at the technical analysis.

The Barchart Technical Opinion rating is a 100% Sell with a Strongest short term outlook on maintaining the current direction. Longer term, the trend strength is Maximum. Long term indicators fully support a continuation of the trend. The market is approaching oversold territory. Be watchful of a trend reversal.

The Exponential Moving Average (EMA) is similar to a simple moving average (average price over a set period) but it utilizes a weighting factor that exponentially declines from the most recent data point (recent prices are weighted higher than oil prices). EMA analysis compares the short term (5 days and 13 days), intermediate term (20 days) and long term (50 days) EMA’s. The respective EMA’s will give bullish signals when trading above trailing EMA’s and below the current price and vice versa. EMA alerts include crossovers (i.e the 5 day EMA crosses above/below the 20 day EMA) and EMA convergencies (5 day EMA equivalent to 13 day EMA). The 5 day EMA 18.03 is higher than the last trade price suggesting a short term bearish pattern building up. Long term, the 50 day EMA 19.44 is also higher than the current trading price depicting a bearish trend overall.

The relative strength index (RSI) is a momentum oscillator that is able to measure the velocity and magnitude of stock price changes. Momentum is calculated as the ratio of positive price changes to negative price changes. The RSI analysis compares the current RSI against neutral(50), oversold (30) and overbought (70) conditions. Alerts will inform you when stocks recede from oversold/overbought levels or breakthrough neutral (50). The current RSI is 26.48 suggesting a bearish price action.

As such, while we believe Ambac Financial Group, Inc. (NASDAQ:AMBC) represents a compelling growth story exposed to several secularly attractive markets, it would be interesting to see how it fairs for long-term investors.

Ambac Financial Group, Inc. is a holding company which provides financial guarantees and other financial services to clients in both the public and private sectors globally, through its subsidiaries. It provides financial guarantee insurance and other credit enhancement products, such as credit derivatives, financial and investment products, including investment agreements, derivative products and funding conduits. Ambac Financial Group, Inc. is headquartered in New York City, United States.

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