Analyst Articles

The biggest winners in the past several decades have included “boring” companies like soda and energy drink maker Monster Beverage (Nasdaq: MNST), an 83,000% gainer, and UGG boot maker Deckers Outdoor (Nasdaq: DECK), which gained more than 10,000%. Studying these and other big winners, we can identify some simple characteristics that the greatest stocks share.#-ad_banner-# First and foremost is that the biggest winners are all real businesses. Small-cap stocks can include companies that are developing products or services, but have not yet generated any sales. As MNST and DECK demonstrate, there is no need to buy before sales confirm that… Read More

The biggest winners in the past several decades have included “boring” companies like soda and energy drink maker Monster Beverage (Nasdaq: MNST), an 83,000% gainer, and UGG boot maker Deckers Outdoor (Nasdaq: DECK), which gained more than 10,000%. Studying these and other big winners, we can identify some simple characteristics that the greatest stocks share.#-ad_banner-# First and foremost is that the biggest winners are all real businesses. Small-cap stocks can include companies that are developing products or services, but have not yet generated any sales. As MNST and DECK demonstrate, there is no need to buy before sales confirm that the company has a viable business opportunity. A record of sales is what distinguishes low-priced stocks with potential from the thousands of penny stocks that will never amount to anything. In addition to sales, the biggest winners also all started their quadruple-digit run-ups from a small market cap (less than $350 million) and a low stock price (less than $10 a share, and occasionally less than $1). We want to buy when they have positive momentum because that indicates that there are other buyers looking at the stock. One mistake many… Read More