If you're similar to stock market investors you have struggled with finding the very best stocks to invest in.
There are several ways to find a very good stocks to invest in. But first you will need to choose what method is most effective for you.
Basically you can find two main kinds of stock market investing
1. Buying growth stocks
2. Buying value stocks
Growth stocks are companies which are growing fast in earnings. There are always a large amount of high tech and medical growth stocks.
Value stocks are stocks which are undervalued since they trade at a lower price set alongside the company's fundamentals (i.e. earnings, dividends, sales etc...)
Growth stocks generally will fatten your bank-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 comprehension of the National Association of Investors Corporation (NAIC) criteria): https://www.scamrisk.com/best-way-to-invest-5k/
1. Strong Earnings Growth - either quarter to quarter or year over year
2. Strong Forward Earnings Growth - analysts estimate what earnings will be for another quarter or year, if they estimate growth that's a plus.
3. Profit margins - you'd prefer the organization to be making a large 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 like 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 less than tangible book value
5. A debt to equity ratio below 1
6. The company's assets should be more compared to 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% a year for the past 10 years
You will find a number of alternative methods to find a very good stock to purchase but this will provide you with a starting point.