Zacks.com Featured Expert Kevin Matras Highlights: Hershey, T-Mobile US, SunTrust Banks, Hill-Rom And VMware
Zacks Investment Research | Jan 07, 2019 03:43AM ET
For Immediate Release
Chicago, IL – January 7, 2019 – Stocks in this week’s article include: The Hershey Company (NYSE:HSY) , T-Mobile US, Inc. (NASDAQ:TMUS) , SunTrust Banks, Inc. (NYSE:STI) , Hill-Rom Holdings, Inc. (NYSE:HRC) and VMware, Inc. (NYSE:VMW) . Kevin Matras screens for companies showing their 'first' profit and explains why they are ones to watch.
Screen of the Week written by Kevin Matras of Zacks Investment Research: 5 Stocks with Solid Sales Growth to Buy Amid High Volatility
There is an age-old Wall Street saying “uncertainty is the enemy of investors.” Therefore, selecting stocks based on key fundamentals is always prudent. Conventional strategies are not only safe, but are also worthwhile in the present volatile and uncertain market conditions. One such strategy is to focus on sales growth.
A healthy business with stable sales growth is vital for survival in today’s fast changing and highly competitive operating environment. Hence, superior revenues are required to drive growth, and most companies look for a strong relationship between sales growth levels and the value of an enterprise.
Revenues are income generated by a company through business activities. Though a company might not be profitable over a particular time period, it usually generates revenues. So, in cases when companies tend to incur a loss temporarily, they are valued on the basis of revenues. This is because sales growth (or decline) is usually an early indicator of the company’s future earnings performance.
While sales growth is an important metric for any corporate for the purpose of growth projections and strategic decision-making, this in isolation doesn’t indicate too much about a company’s future financial performance. Though it provides investors an insight into product demand and pricing power, a huge sales number does not necessarily convert into profits.
Hence, a consideration of a company’s cash position along with its sales number can be a more dependable strategy. Substantial cash in hand and a steady cash flow give a company more flexibility with respect to business decisions and further potential investments. Also, an adequate cash position suggests that revenues are being channelized in the right direction.
For the rest of this Screen of the Week article please visit Zacks.com at:Zacks Investment Research
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