K12 (LRN) Just Flashed Golden Cross Signal: Do You Buy?

K12 (LRN) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, LRN crossed above the 20-day moving average, suggesting a short-term bullish trend.

The 20-day simple moving average is a popular investing tool. Traders like this SMA because it offers a look back at a stock's price over a shorter period and helps smooth out price fluctuations. The 20-day can also show more trend reversal signals than longer-term moving averages.

Like other SMAs, if a stock's price is moving above the 20-day, the trend is considered positive. When the price falls below the moving average, it can signal a downward trend.

Shares of LRN have been moving higher over the past four weeks, up 9.3%. Plus, the company is currently a Zacks Rank #2 (Buy) stock, suggesting that LRN could be poised for a continued surge.

The bullish case solidifies once investors consider LRN's positive earnings estimate revisions. No estimate has gone lower in the past two months for the current fiscal year, compared to 3 higher, while the consensus estimate has increased too.

Given this move in earnings estimate revisions and the positive technical factor, investors may want to keep their eye on LRN for more gains in the near future.

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This article originally published on Zacks Investment Research (zacks.com).

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