Zacks.com Featured Expert Kevin Matras Highlights: Houston Wire & Cable, Adesto, Textainer, Trupanion And Upland Software
Zacks Investment Research | Jan 24, 2018 11:13PM ET
For Immediate Release
Chicago, IL – January 25, 2018 - Stocks in this week’s article include: Houston Wire & Cable (NASDAQ:HWCC) , Adesto Technologies (NASDAQ:IOTS) , Textainer Group Holdings (NYSE:TGH) , Trupanion (NASDAQ:TRUP) and Upland Software (NASDAQ:UPLD) . 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: A Company's First Profit Can Mean Big Profits for Investors
With earnings season upon us, now is a great time to take a look at my 'First Profit' stock screen. The concept for this one is to identify companies that have recently shown their first quarterly profit within the last year.
More specifically, to find companies that have not shown a profit for at least the previous 4 quarters, but have just recently produced their first profit this last quarter.
I run this screen after every earnings season. And here we are again.
Some of these companies will be relatively new, and this recent profit may be the only profit in the company's history so far.
Other companies may have a long history of profitability, but for whatever reason haven't seen a profit in a while -- but has finally returned to profitability.
I like this concept because, if the trend has been one of improvement, there's a good chance the trend will continue. This is true whether you've been profitable or are just getting profitable.
But some people (like myself for example) dislike buying companies that cannot show a profit. And there are many others who won't even consider a stock unless it’s making money.
Losing less than the previous quarter is indeed an improvement. And in that respect, by definition, it is growth, i.e., they're growing less unprofitable. And it’s even better if the losses are less and less in each sequential quarter.
But there's something entirely different about growth AND being profitable. And those are the stocks that will likely see the best new demand from new investors; people who are now, all of a sudden, willing to take notice of, and pay attention to, the stock.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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