Re: [CANSLIM] Fundamental Philosophies

From: "Tom Worley" <stkguru@bellsouth.net>
Subject: Re: [CANSLIM] Fundamental Philosophies
Date: Fri, 6 Dec 2002 09:18:49 -0500

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Dave, the 51% earnings growth this year is essentially already history. We
have less than a month left on that forecast. On the other hand, the 22%
growth for next year comes on a higher level of profits, it's pretty tough
for a company to keep making 51% year over year when the number to increase
from continues to grow like that.

I saw the 40% funds ownership, and gave me pause. But when I checked the
Management ownership (68%) and the resulting size of the float, it
diminished in importance. However, I would expect to see Management
lightening up their ownership over the next year if the price keeps moving
like it has been.

- ----- Original Message -----
From: <Davellil5@aol.com>
To: <cjcorley@hiwaay.net>; <canslim@lists.xmission.com>
Sent: Friday, December 06, 2002 9:08 AM
Subject: Re: [CANSLIM] Fundamental Philosophies


One of our members has said that a stock may be selected for purchase when
there is a preponderance of evidence showing conformance with CANSLIM
criteria.  This makes sense because it is very rare for a stock to conform
100%.

Nevertheless, there are  some go-nogo conditions.  PECS provides us with a
good example of one of those conditions.  PECS has displayed great growth.
EPS growth this year is expected to be 51%.  However, EPS growth for next
year is projected to be only 22%, less than half as much.  There's nothing
shabby about 22% growth, but coming after 51%, it forces us to wonder
whether
the price of the stock already reflects all the prospects for the Company.
Maybe that's why PECS broke out on high volume November 25th, only to
collapse on high volume December 2nd, and is now flirting with its 50DMA.

I've been burned by stocks that I bought because of great growth records in
spite of much slower future growth projections.  So, now, that is a go-nogo
condition for me.   Maybe I'll miss a few "comers", but I just don't want to
take that risk again.

It would be useful for us CANSLIM-ers to discuss  strict go-nogo conditions
in these e- mails.  Does anyone else have them?

Regards to all, Dave









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