Down -9.13% in 4 Weeks, Here's Why You Should You Buy the Dip in United Microelectronics (UMC)

Core Viewpoint - United Microelectronics Corporation (UMC) has faced significant selling pressure, resulting in a 9.1% decline in stock price over the past four weeks, but analysts anticipate better earnings than previously expected, indicating potential for recovery [1]. Group 1: Technical Indicators - UMC's Relative Strength Index (RSI) is at 29.9, suggesting that the heavy selling may be exhausting, which could lead to a price rebound as the stock seeks to return to its previous equilibrium of supply and demand [3]. - The RSI is a momentum oscillator that ranges from 0 to 100, with a reading below 30 typically indicating that a stock is oversold, thus presenting potential entry opportunities for investors [2]. Group 2: Fundamental Indicators - There has been a strong consensus among sell-side analysts to raise earnings estimates for UMC, resulting in a 2.3% increase in the consensus EPS estimate over the last 30 days, which often correlates with near-term price appreciation [4]. - UMC holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a turnaround [4].