It shows that the company is making money through the years. Revenue has to grow consistently for a period of 3 years at least for a consistent track record. All three pointers have to be growing consistently over the years. Here’s some example of good earnings report.įrom the chart above, you need to look at the Revenue, Gross Profit and Net income after taxes.
A company without revenue or profits is a company that is waiting to get bankrupt. Any good quality companies needs to have good earnings growth. Time is our best friend when it comes to Stock Market. If not, you should hold on to your stock for as long as you can for a Tenbagger.
As such, we should sell away or avoid the stock. Management of Luckin Coffee is not trustworthy. When that happens, stock price will be affected.įor example, Luckin Coffee, a China coffee company, their fundamentals changed when their accounting have been reported fraud. When a company changes it’s direction or lose focus, it’s fundamentals changes.
#One up on wall street peter lynch how to
For tips on how to identify good quality companies click here.įor Peter Lynch, the only time you would like to sell your stock is when it’s fundamentals are no longer valid upon your previous conviction. It’s easy to identify them as most of them are big brand companies example, Amazon or Apple. Usually good quality stock companies comes from high market capitalization. When there’s a drop or a huge dip, it presents an opportunity to take the trade. Make sure you have at least 15-20 companies to kick start. Using a lists of companies at hand, you will be able to find good quality opportunity or technical setups easily.