Re: [CANSLIM] DRS

From: "Tom Worley" <stkguru@netside.net>
Subject: Re: [CANSLIM] DRS
Date: Thu, 7 Mar 2002 20:15:02 -0500

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Hi Harbol,

Most investors tend to look only at earnings (and sales) on a year to year
comparison (e.g. Q3 of 2001 to Q3 of 2000). This is reasonable, and helps
compensate for any seasonal or cyclical variations. But I also look at
earnings on a sequential basis (in other words was Q4 better than Q3 which
was better than Q2 ...). Naturally, this approach doesn't work well on a
company with strong seasonal / cyclical variations. I also look at earnings
with respect to sales the same qtr. This examines net profit margins, which
should be improving if sales are growing.

I have a strong preference for companies with steady growth when measured on
a sequential basis. This makes it much easier to judge the likelihood of
analysts forecasts, or make my own forecasts. It also helps judge what the
real "expectations" are, thus reacting quicker when expectations are
significantly missed or exceeded.

Tom Worley
stkguru@netside.net
AIM: TexWorley
- ----- Original Message -----
From: "HARBOL GAURANG" <morsandbihari@hotmail.com>
To: <canslim@lists.xmission.com>
Sent: Thursday, March 07, 2002 9:47 AM
Subject: Re: [CANSLIM] DRS


Hi Tom,
  Can you explain what do you mean by "they are both fairly flat on a
sequential basis" ? Are you talking about quarter to quarter sales and
earning growth ?

Quarter/Sales/EPS
Dec,2001  /141.24/0.38
Sep,2001  /116.18/0.34
June,2001 /103.35/0.30
March,2001/129.92/0.34
Dec,2000  /95.93 /0.28
Sep,2000  /107.23/0.20
June,2000 /94.52 /0.18
March,2000/114.00/0.23


Thanks,
Harbol.

>From: "Tom Worley" <stkguru@netside.net>
>Reply-To: canslim@lists.xmission.com
>To: <canslim@lists.xmission.com>
>Subject: Re: [CANSLIM] DRS
>Date: Wed, 6 Mar 2002 21:07:16 -0500
>
>I never have liked a descending handle, even tho I realize that WON does.
>Today's volume less than ADV, but yesterday's was 2X ADV. Today's large
>price gain, altho on light volume, does bring it close to the pivot point.
>
>%age Y2Y gains in both earnings and sales were very good in 2001, but I
>would be concerned that they are both fairly flat on a sequential basis.
>Fiscal year ends March, and they must earn 40 cents just to make full year
>forecast. However, forecast for fiscal 2003 is for only an 8% earnings
>growth. That would stop me right there.
>
>Tom Worley
>stkguru@netside.net
>AIM: TexWorley
>----- Original Message -----
>From: Eric Jaenike
>To: canslim group
>Sent: Wednesday, March 06, 2002 8:06 PM
>Subject: [CANSLIM] DRS
>
>
>I like the looks of DRS' cup w/ handle. 88 94 ABB. Good action in LLL, ATK,
>and others in group, 4 up weeks on higher volume vs. 1 down week in base,
>good support on daily price volume, with positive spikes on 12/14, 1/16,
>3/5. Thoughts?
>
>Eric
>
>
>
>
>
>---------------------------------------------------------------------------
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