|
|
Positive Growth
A large portion of what drives stock prices is expectations of the future.
This is why future earnings growth projections (even though they are
just opinions) can be important. Future growth estimates for the current
quarter, next quarter, current year, and next year are taken into account
when putting together our Overall Ranking for
the stocks in our database.
Stocks that have negative growth projected tend to lag behind positive growth
stocks in terms of price performance. This is why we categorize certain stocks
in our database as Positive Growth stocks.
In order to be categorized as a Positive Growth stock, a company must meet
all of the following criteria:
- The current quarter's growth estimate percentage (if known) is projected to be
positive.
- The next quarter's growth estimate percentage (if known) is projected to be
positive.
- In addition, the next quarter's earnings per share (EPS) estimate amount
may not be a negative number (i.e. a loss).
- The current year's growth estimate percentage (if known) is projected to be
positive.
- The next year's growth estimate percentage (if known) is projected to be
positive.
- In addition, the next year's earnings per share (EPS) estimate amount
may not be a negative number (i.e. a loss).
A negative EPS estimate is "forgiven" for the current quarter and current year, but
not for the next quarter or next year. This is because we want to
focus on those companies that will have real growth into actual earnings in the
near future. A company that is projected to have its EPS change from
-$0.25 this year to
-$0.15 next year may have positive
growth (because its loss is shrinking), but because it will still be losing
money next year, it will not be considered a Positive Growth stock.
At this time, about 50% of the companies in our database meet
the criteria to be considered Positive Growth Stocks. Those stocks are shown
in all of our stock screens in boldface so that you can focus on just those
companies if you wish.
We go one additional step and also categorize some of the Positive Growth
stocks as Undiscovered Growth stocks. These are
stocks that meet additional rigorous criteria for growth.
|
|