If you're like most stock market investors you've struggled with finding the very best stocks to invest in.
There are numerous ways to find the best stocks to invest in. But first you need to choose what method works best for you.
Basically you can find two main types of stock market investing
1. Buying growth stocks
2. Buying value stocks
Growth stocks are companies which can be growing fast in earnings. There are certainly a large amount of advanced and medical growth stocks.
Value stocks are stocks which can be undervalued because they trade at a lower price compared to the company's fundamentals (i.e. earnings, dividends, sales etc...)
Growth stocks generally will fatten your banking account faster but there's more risk whereas value stocks will generally grow at a slower more sustainable pace but probably won't offer you ulcers.
Here's what some investors search for in a growth stock (based on my knowledge of the National Association of Investors Corporation (NAIC) criteria):
1. Strong Earnings Growth - either quarter to quarter or year over year
2. Strong Forward Earnings Growth - analysts estimate what earnings will undoubtedly be for another quarter or year, should they estimate growth that's a plus.
3. Profit margins - you'd prefer the business to be making a considerable amount of profit to sustain further growth
4. Return On Equity (ROE) - search for growth in ROE or a well balanced ROE
5. Doubling in 5 years or less - you'd prefer the stock to double in 5 years - look at what the analysts estimate for price potential.
Also here's what some value investors search for:
1. Shares price below intrinsic value
2. Low Price to Earnings (P/E) ratios
3. Price to Earnings Growth (PEG) ratio below 1 is good
4. Stock price is significantly less than tangible book value
5. A debt to equity ratio below 1
6. The company's assets should be much more than the company's liabilities by at the least an issue of 2
7. Dividend Yield within 1/3 of the total amount of the AAA bond yield
8. Earnings growth of at the least 7% per year for the past 10 years
You will find all sorts of different ways to find the best stock to purchase but this will offer you a starting point https://www.scamrisk.com/best-way-to-invest-5k/.