Here is a list of Important characteristics a stock should have
-Low leverage and financial flexibility to execute allocation strategy
-High Earnings Yield relative to growth (opposite of P/E Ratio) earnings/market cap
-Strong business fundamentals to fend off competition and market share loss
-Strong Free Cash Flow- best way to stregnthen balance sheet and make investments
-Management has "skin in game"---incentive to increase shareholder value
-Margin growth- fundamental improvement in margins (not just cyclical)
-future growth through new products or geographic expansion
If your stock embodies most of these qualifications, you are in great position to outperform the stock market
Tuesday, October 19, 2010
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