Sales and Earnings Growth
How Sales and Earnings Growth
can affects a Stock’s Performance
If you go back through the history of the stock market there is a recurring theme among those stocks which have had some of the strongest price appreciation and it’s related to their Sales and Earnings Growth. Let’s cast at two companies over the past few years and compare their Sales and Earnings Growth.
First let’s look at Microsoft ( MSFT ) which has hard meager Sales and Earnings Growth in 2002 and 2003. Since the market made a substructure in October of 2002 MSFT has seen extremely little price gratitude since then. Transmit in early October of 2002 MSFT was trading around $22 a share and in late March of 2004 MSFT was trading near $24 a share. Thus while the major averages epigram significant gains from October of 2002 into the early part of 2004 MSFT was only up 9 %.
Right now let’s look at a stock which has been exhibiting strong Sales and Earnings Growth over the past year or so. As you can see lower Taser ( TASR ) has seen speeding up Sales and Earnings enlargement over the earlier period two quarters which has been replicated in its stock price. TASR formed a " Cup and Handle " pattern before breaking out in September of 2003 and cerise almost 800 % from September of 2003 through mid February of 2004.
As these examples show those companies which have accelerating Sales and Earnings Growth have the potential to perform very well while those with penurious Sales and Earnings will languish even in a Bull Market environment. I would think those investors who have held MSFT over the past few years aren’t especial carefree as the stock price has virtually gone nowhere since October of 2002 into the early part of 2004.
The key is to recognize those companies which are autochthonous to establish a trend of accelerating Sales and Earnings Growth before everyone else does which takes a lot of time and look into. This is what I do every week as I spend over 20 hours a past looking for companies that are starting to show signs of accelerating Sales and Earnings Growth.