Hanging out with people of dubious character can be lots of fun. They're exciting. And so full of surprises! But sooner or later, you'll wind up sleeping in your car with one eyebrow shaved off and your wallet missing.
Just like people, companies can be of good or bad character - or at least, their earnings can. In the short term, you can have some fine times with the stocks of companies whose earnings are suspect. Over the long term, though, you're better off hanging out with the stocks of companies that have high-quality earnings.
Stocks of lower-quality companies have been on fire since 2003. In the first quarter alone, low-quality stocks beat their high-class peers by 17.3%, says Fernando Garza, senior analyst at ING Investment Management.
http://news.yahoo.com/s/usatoday/20060428/bs_usatoday/johnwaggonerinvestingstocksarelikeshoesqualitymatters
Just like people, companies can be of good or bad character - or at least, their earnings can. In the short term, you can have some fine times with the stocks of companies whose earnings are suspect. Over the long term, though, you're better off hanging out with the stocks of companies that have high-quality earnings.
Stocks of lower-quality companies have been on fire since 2003. In the first quarter alone, low-quality stocks beat their high-class peers by 17.3%, says Fernando Garza, senior analyst at ING Investment Management.
http://news.yahoo.com/s/usatoday/20060428/bs_usatoday/johnwaggonerinvestingstocksarelikeshoesqualitymatters
