Picking Winners - Part 4

每一類公司要留意的地方；
STALWARTS
1. The key issue is price, and the p/e ratio will tell you whether you are paying too much.
2. Check the company's long term growth rate, and whether it has kept up the same momentum in recent years.
3. See how the company has fared during previous recessions and market drops.

CYCLICALS
1. Keep a close watch on inventories, and the supply-demand relationship. Watch for new entrants which is usually a dangerous development.
2. Anticipate a shrinking p/e multiple over time as business recovers and investors look ahead of the end of cycle, when peak earnings are achieved.

FAST GROWERS
1. What the growth rate in earnings has been in recent years. (Lynch's favourites are the ones in the 20 to 25 percent range. Company growing faster than 25% normally found in hot industries)
2. The company has duplicated its successes in more than one city or town, to prove that expansion will work.
3. The company still has room to grow.
4. Whether the stock is selling at a p/e ratio at or near the growth rate.

TURNAROUND
1. Can the company survive a raid by its creditors?
2. How is the company supposed to be turning around?

ASSEST PLAYS
1. What's the value of the assets? Are there any hidden assets?
2. Is the company taking on new debt, making the assets less valuable?