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Then periodically check to see if plans are working.I check out this magazine from various locations as well as it appears to be extremely recommended for any kind of private curious about costs. įuture earnings can’t be predicted – Find out how a company plans to increase earnings, (relative to others in the same industry) – Think of it as the number of years it will take to earn back your initial investment. The number one factor when analyzing a company  P/E ratio – Use it to get hints about whether a stock is overvalued What is the one single stock to avoid? – The hottest stock in the hottest industry Picking Winners – It’s a user of technology. – The institutions don’t own it and the analystsĭon’t follow it. Look for companies with these characteristics: – It sounds dull-or, even better, ridiculous. One characteristic of the perfect company – “Any idiot can run this business.” Turnarounds – No growers usually in Chapter 11 or on verge – Upside: Bargain stock with huge accounting loss carry-Īsset Plays – Company sits on valuable asset that you know about Stalwarts – Annual growth around 10 to 12%įast Growers – Small and aggressive with 20 to 25% annual growth – Plenty of risk – Expect stock appreciation, not dividendsĬyclicals – Profits and sales rise and fall in regular fashion – Timing is everything detect the early signs Slow Growers – Large companies growing around rate of GNP – Expect dividends When looking at the strength of a company’s product, judge the effects on the bottom line – Is the company too big?

Look for “tenbaggers” – Stock that goes up ten-fold or 900% – Do I own a house? – Do I need the money? – Do I have the personal qualities it takes to Lynch’s Initial Advice “Kick the tires”  Don’t worry about the market-it’s the stock! (bottom-up)  Pass the “mirror test”   Don’t listen to the pros – “Oxymorons”  Observe your environment for potential winners  Lynch’s Initial Advice Lynch’s mantra: Average investors can become experts in their own field and can pick winning stocks as effectively as Wall Street professionals by doing just a little research. Graduated from Wharton School of Business  Managed Fidelity Magellan Fund (19771990) – Most successful fund in the world – Owns over 1400 stocksīelieves in Fundamental, Bottom-Up Approach One Up On Wall Street Peter Lynch With John Rothchild