Company Overview: Herald Investment Trust PLC is an FTSE 250 index listed UK-based investment entity with the goal of generating capital growth by investing in smaller publicly listed companies within the telecommunications, multimedia, and technology (TMT) sectors. This Report covers the Price Action, Technical Indicators Analysis along with the Support Levels, Resistance Levels, and Recommendations on this stock.

FY24 Results (for the 12 months ended 31 December 2024)

In 2024, the company's performance was notably strong, with a 12.1% increase in its Net Asset Value (NAV) per share. The North American portfolio delivered a remarkable return of 36.3%, significantly outpacing the Russell 2000® Technology Index, primarily driven by standout performers like Super Micro Computer and Celestica. However, the UK portfolio lagged behind, returning just 3.3%, underperforming the Deutsche Numis Smaller Companies plus AIM Index due to the weak performance of AIM stocks. This was partly influenced by market concerns over potential changes in Inheritance Tax relief, which were later confirmed in the UK Budget. Despite these challenges, the company remains optimistic about the long-term potential of investing in smaller technology companies, emphasizing that active management in this sector can yield superior returns, especially in an environment where larger tech stocks have dominated in recent years.

HRI’s Technical Observation:

The stock is showing a robust upward trend, trading above a significant horizontal support level, indicating potential for continued growth. Bullish candlestick patterns further reinforce this positive outlook, suggesting possible gains ahead. The 14-day Relative Strength Index (RSI) is at 30.83, leaving room for further upward movement before reaching overbought territory. These technical indicators and support levels together suggest that the stock's positive momentum could continue in the near term.

HRI’s Daily Chart

As per the above-mentioned price action and technical indicators analysis, a ‘Speculative Buy’ rating has been given on Herald Investment Trust PLC (LSE: HRI) at the closing Price of GBX 2,210.00, as of February 28, 2025. Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Markets are trading in a highly volatile zone currently due to certain Macro & Micro-economic data and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: Investment decisions should be made depending on an individual’s appetite for upside potential, risks, and any previous holdings. This recommendation is purely based on technical analysis, and fundamental analysis has not been considered in this report. Individuals can consider exiting from the stock if the Target Price or Stop loss mentioned as per the technical analysis has been achieved and is subject to the factors discussed above.

Note 3: Related Risks: This report may be looked at from a high-risk perspective and recommendations are provided for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rate risks, currency risks, social and political instability risks etc.

Note 4: How to Read the Charts?

The Green colour line reflects the 21-period moving average while the red line indicates the 50- period moving average. SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect against further losses in case of unfavorable movement in the stock prices.

The reference date for all price data, currency, technical indicators, support, and resistance levels is February 28, 2025. The reference data in this report has been partly sourced from REFINITIV.

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

GBP: British pound sterling

GBX: British pence sterling

RSI: Relative Strength Index

USD: United States dollar

Note: Trading decisions require a thorough analysis by individuals. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.