Long Term Technical Analysis Of Sony

The following is a long term technical analysis of Sony Corporation using our 3650 trading day moving average (BLUE LINE).  The "Value" line (GREEN) is a 33% discount to that moving average and the "Deep Value" line (PURPLE)  is a 66% discount to that moving average. Currently Sony is hovering in Deep Value territory, and when a company's stock price hits that level, it either continues its slide until the company eventually goes bankrupt or it recovers nicely, usually resulting in large gains for the Deep Value investor. 

Back on December 12, 2012, Sony hit a thirty year low, when its stock price hit $9.63.  After it hit that price, it then formed a "V" pattern and shot up to $22.91 in just six months, for a gain of 137.90%.  From there it has drifted lower and currently trades at $17.11 for a correction of -25.31%.  Sony still trades it is Deep Value Zone (the area between its Value and Deep Value lines) and can still be considered cheap.  

Sony Corporation is known worldwide for its quality products and thus its trademark probably has a strong intangible value.  Therefore if its stock price continues to fall and actually hits its current Deep Value price of $14.22, it might be worth investing in for the long run.  Deep Value Investing is not for the faint of heart and the price movements can be considerable on the downside, until a successful turn-around plan is fully implemented.  So if you plan to follow such a strategy, do so with a largely diversified portfolio.

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