Today I am going to start a series of posts on my method of picking stocks. This will go on for several posts since there are quite a lot of factors, so be sure to check back periodically. I’ll start my listing the factors I look at, and then with new posts discuss some of the factors in detail.
Once again, we’re looking for stocks that will grow over the next several years, not just short-term fads. I’ve found it is easier to spot long-term trends than predict what the market will do over any short stretch. In fact, the long-term trends are often pretty clear – it is surprising that more people don’t seem to look for them. Here are the factors I look at, relatively in order of importance:
- The long-term price trend
- Earnings growth rate
- Dividend growth rate
- Return on Equity
- Debt
- Cash flow
- The business type/strategy
I’ll go through each of these factors in detail in subsequent posts.
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Disclaimer: This blog is not meant to give financial planning or tax advice. It gives general information on investment strategy, picking stocks, and generally managing money to build wealth. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. Tax advice should be sought from a CPA. All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.
Will you give examples of stocks that meet this criteria?