Zacks.com Featured Highlights: BorgWarner, PG&E, Teradyne, TransUnion And CBRE Group
Zacks Investment Research | Nov 08, 2017 06:40AM ET
For Immediate Release
Chicago, IL – November 8, 2017 - Stocks in this week’s article BorgWarner Inc. (NYSE:BWA) , PG&E Corporation (NYSE:PCG) , Teradyne, Inc. (NYSE:TER) , TransUnion (NYSE:TRU) and CBRE Group, Inc. (NYSE:CBG) .
Solid Sales Growth Makes These 5 Stocks Worth Buying Now
Sales growth is an important measure for any company, as it is vital to growth projections and strategic decision making. By monitoring this key metric over multiple time periods, one can clearly understand a company’s growth trend.
Sales growth is essential to justify the expenses incurred to operate a business. Low revenues lead to an unprofitable business and dismal financial performance. Stagnant companies may generate near-term profit but cannot generate enough growth to attract new investors.
Also, in a growing economy, lack of sales growth most likely denotes that the company is not gaining market share over its competitors. In simple terms, without impressive sales growth, the bottom-line improvement may not be sustainable over the longer term.
Further, it's worth keeping in mind that when companies incur a loss, albeit transitorily, they are valued on their revenues, as sales growth (or decline) is usually an indicator of a company's future earnings performance.
Hence, the Price-to-Sales (P/S) ratio can turn out to be an appropriate metric for stock valuation. This metric's importance lies in the fact that management has limited opportunities to manipulate sales unlike earnings.
Focusing alone on sales growth is, however, not desirable. Considering a company's cash position along with its sales number can prove to 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 investments.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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