Growth Stocks

“The successful purchase of growth stocks requires two rather obvious conditions: First, that their prospect of growth be realized; and, second, that the market has not already pretty well discounted these growth prospects.”

“To my mind, the so-called growth-stock investor — or the average security analyst for that matter — has no idea of how much to pay for a growth stock, how many stocks to buy to obtain the desired return, or how their prices will behave.”

“Many mistakes have been made in buying growth stocks on the theory that the future will duplicate the past.”

“My experience leads me to predict that the action of the market will govern the investor’s choice as to probable future growth rates, rather than vice-versa.”

“Growth stock investing may be more a philosophy of buying what is popular. Value investing is more a philosophy of buying what is out of favor.”

“The enchantment which some growth companies convey to the stock market lends a premium to their common stocks which is not always justified by the statistical background.”

“The ability to create its own market is the strategic, the dominating, and the single most distinguishing characteristic of a true growth company.”

“I think it’s dangerous to buy companies that everyone thinks are excellent and that are relatively slow-growth companies.”

“You can’t go to sleep holding cyclical stocks for a decade and expect to be richly rewarded. The rich rewards are in growth stocks and special situations.”

“The fact that a stock is considered to be growth stock is no assurance against a decline in income or market value during the downtrend of a business cycle, as growth stocks often depreciate as much as other groups.”

“When picking a list of growth stocks for long-term investment, broad diversification of the risk is the first and most important principle to follow. No one can look ahead five or ten years and say what is the most promising industry or the best stock to own.”

“Growth stocks are as varied in their characteristics as a surgeon’s instruments or a carpenter’s tools and, similarly, successful results are dependent on knowledge and experience in their proper use.”

“While the trend in profit margins is one of the most important factors to consider, it is not always the company which reports the higher profit margin that proves to be the better growth stock.”

“No mathematical formula or yardstick alone can be relied on for identifying growth stocks or for detecting when their earnings reach maturity.”

““Growth stocks” can be defined as shares in business enterprises which have demonstrated favorable underlying long-term growth in earnings and which, after careful research study, give indications of continued secular growth in the future.”