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National Express Share Price Has Fallen 23.9% in Six Months. Can It Recover?

Simon Mugo trader
Updated 5 Nov 2021

National Express Group PLC (LON: NEX) share price has fallen 23.9% in six months, and many investors wonder whether the shares can recover?

Firstly, we have to look at the company’s fundamentals to see if its long term prospects are solid and if the firm is on a growth trajectory.

Luckily for investors, National Express recently revealed that passenger numbers on its buses had risen to 76% of the pre-pandemic levels despite the transport industry’s many challenges.

The company revealed that its operations were unaffected by the UK fuel shortage due to hedging activities to secure its fuel supply chain. The firm had bought enough petrol to keep fueling its buses for up to 2023 and was safe from the current supply shortages. 

National Express shares rally on plans to acquire UK rival stagecoach

Still, the company has not been spared from the driver shortage affecting many countries, including the UK and the US, which has led to its US school bus service running at 92% capacity.

The transport company said that it expects 2021 profits to be in line with its initial estimates.

Therefore, it is evident that National Express’ fundamentals are pretty solid, which leads us to the next part of our analysis focusing on its price chart.

The daily chart below shows that the NEX share price recently bounced off the 261.9p support level drawn in September when I wrote this article, which underscores the importance of technical analysis.

National Express shares have since bounced off this level twice, indicating its significance and are currently trading above the level.

However, the transport company’s shares are trading below the crucial 50-day and 100-day moving averages, indicating that they are still in a downtrend. Furthermore, the company is expected to make a firm offer for Stagecoach by 16 November 2021.

We could see its shares fall if the deal does not materialise, given that many investors are looking forward to the acquisition to increase National Express revenues. 

As a trader, I would be looking to buy NEX shares if they cross above the 240p level, leading to further gains.

*This is not investment advice. Always do your due diligence before making investment decisions. 

National Express share price.

IG chart of National Express share price 05-11-2021
Source: IG

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Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading