Chicago, IL – July 14, 2009- Kevin Matras goes over a screen that finds companies with a history of increasing quarterly earnings over the last 7 quarters. Highlighted stocks in this week’s article include Express Scripts, Inc. (NYSE: ESRX), Cyberonics, Inc. (NASDAQ: CYBX) and Transdigm Group, Inc. (NYSE: TDG). Click here for the full story exclusively on Zacks.com: http://at.zacks.com/ ?id=5528.
Screen of the Week written by Kevin Matras of Zacks Investment Research:
With more than 2,200 companies reporting earnings by month’s end, here’s a screen to help you find companies that have consistently shown increasing earnings growth.
In both good markets and bad, strong earnings are one of the most important factors that influence stock prices.
But instead of just looking at the most recent quarter’s earnings, try looking for a pattern of increasing earnings.
Steadily increasing earnings, in which each period improves upon the last, typically means the company is doing something right – and has been for a while. And this trend is likely to continue, especially when they demonstrate earnings excellence in challenging times.
The Parameters
In this screen, I’m looking for each of the last 7 quarters of earnings to be greater than the previous quarter’s earnings.
The parameters are:
- Quarterly EPS Q(0) > Quarterly EPS Q(-1)
- Quarterly EPS Q(-1) > Quarterly EPS Q(-2)
- Quarterly EPS Q(-2) > Quarterly EPS Q(-3)
- Quarterly EPS Q(-3) > Quarterly EPS Q(-4)
- Quarterly EPS Q(-4) > Quarterly EPS Q(-5)
- Quarterly EPS Q(-5) > Quarterly EPS Q(-6)
- Quarterly EPS Q(-6) > Quarterly EPS Q(-7)
This screen is a great stock picker because it demands earnings performance from a company over an ‘extended’ period of time.
This strategy will typically find stocks with fantastic earnings consistency and a history of beating earnings expectations.
For those using the research wizard, here’s what hat screen looks like, all set up thru the Calculation expression feature:
Here are 3 stocks from the list for this week (7/14/09):
ESRX Express Scripts, Inc.
CYBX Cyberonics, Inc.
TDG Transdigm Group, Inc.
Most screeners won’t allow you to compare one period’s earnings to another period, let alone the last 7 quarters or more. But the Research Wizard will.
Get the rest of the stocks on this list and start finding companies with a history of increasing earnings today. It’s easy to do. Sign up for a free trial to the Research Wizard today: http://at.zacks.com/?id=5529.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
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