China-based Atour Lifestyle Holdings is taking another pause Monday below the buy point of a cup base. ATAT stock gained 4.1% last week and reached a buy point Thursday, but the breakout faded.
The IBD 50 Growth Stocks To Watch name is pulling back nearly 2% Monday in light volume and is currently 5% below the cup base entry.
Atour Lifestyle brands operates midscale to luxury hotels in China. It uses proprietary digital technology to personalize products and services for its guests. It offers a customer loyalty program, helping with customer retention. As of March, it had 1,727 hotels with 194,559 rooms and 755 hotels under development.
The IBD 50 stock holds the top spot in the leisure sector, one of the IBD 33 sectors and sits on the MarketSurge Growth 250. It ranks No. 1 out of 11 stocks in the Leisure-Lodging group, which holds the 145th spot out of the 197 industry groups that Investor's Business Daily tracks.
Atour stock started trading Nov. 11, 2022, with an offer price of 11 per share and is a component of IBD's IPO Leaders screen.
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ATAT Stock Just Needs A Push
Shares broke out of a cup base with a 33.31 buy point in heavy volume May 22, after the hotel operator topped first-quarter earnings and sales estimates. But the stock retraced and closed below the entry.
Atour stock triggered the 7% sell rule in late May, after falling around 9% below the buy point. The hotel stock has been trading in the 30 to 32 range and finding resistance around 33 since the unsuccessful breakout.
ATAT stock teased investors once again Thursday by reaching the buy point then closing below it.
Shares remain above the 21-day exponential moving average and its 50-day moving average is starting to turn upward slightly.
Its relative strength line has been in a jagged sideways trend since the stock pulled back in late May.
China Hotel Holds Top IBD Ratings
Its first-quarter earnings of 34 cents per share climbed from 26 cents per share a year ago. Its first-quarter sales growth eased to 29% from 53% two quarters ago.
Its profit growth averaged 40.8% over the last three quarters, according to IBD Stock Checkup. Full-year 2025 and 2026 forecasts both show profit rising 25%.
Lastly, its robust profit growth earned the hotel name a best-possible 99 Earnings Per Share Rating and a hearty 96 Composite Rating.
As of March, 233 mutual funds owned shares, up from 223 in December and 140 in September. Its IBD Accumulation/Distribution Rating of B indicates moderate institutional buying over the last 13 weeks.
And its 1.3 up/down volume ratio shows positive demand over the last 50 days.
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