With earnings season once again upon us, it's time for me to
pull out my 'First Profit' stock screen. The concept for this one
is to find companies that have just recently shown their first
quarterly profit within the last year.
The idea is to find companies that have
shown a profit for at least the previous 4 quarters, but have just
recently produced their first profit this last quarter.
I run this screen after every earnings season. And here we are
Some of these companies will be relatively new, and this recent
profit may be the only profit in the company's history so far.
Other companies may have a long history of profitability, but for
whatever reason haven't seen a profit in a while -- but has finally
returned to profitability.
I like this concept because, if the trend has been one of
improvement, there's a good chance the trend will continue. This is
true whether you've been profitable or are
But some people (like myself for example) dislike buying companies
that cannot show a profit. And there are many others who won't even
consider a stock unless it's making money.
Losing less than the previous quarter is indeed an improvement. And
in that respect, by definition, it is growth, i.e., they're growing
less unprofitable. And it's even better if the losses are less and
less in each sequential quarter.
But there's something entirely different about growth AND being
profitable. And those are the stocks that will likely see the best
new demand from new investors; people who are now, all of a sudden,
willing to take notice of, and pay attention to, the stock.
And that's what we're screening for today:
EPS for the previous 4 Quarters less than or equal to
(This means in each of the previous 4 quarters (except the most
recently reported quarter) the company has reported earnings of
less than or equal to zero, i.e., no profit.)
EPS for the recently reported quarter greater than
(This time, the company reported earnings greater than zero,
meaning they finally showed a profit.)
Current Price greater than or equal to 5
(I prefer to only look at companies over $5. But if you drop this
item from the screen, it'll currently produce three times as many
stocks coming thru the screen.)
BTW - for those who have the Research Wizard and want to build
this on their own - here's what the screen looks like. You don't
have to use the calculation expression feature either. It can all
be done from the main page. (See below.)
The screen is pretty simple yet pretty powerful.
Here are 5 stocks that made it thru this week's screen (for
Exterran Holdings, Inc.
The St. Joe Company
Lawson Products, Inc.
Pandora Media, Inc.
Vulcan Materials Company
Get the rest of the stocks on this list and start looking for the
newest companies that fit this criteria. It's easy to do. And it
could help you find your next 'best' stock. Start screening for
these companies today with a free trial to the Research Wizard. You
can do it.
Click here for your 2 week free trial to the
Disclosure: Officers, directors and/or employees of Zacks
Investment Research may own or have sold short securities and/or
hold long and/or short positions in options that are mentioned in
this material. An affiliated investment advisory firm may own or
have sold short securities and/or hold long and/or short positions
in options that are mentioned in this material.
Disclosure: Performance information for Zacks' portfolios and
strategies are available at:
EXTERRAN HLDGS (EXH): Free Stock Analysis
ST JOE CO (JOE): Free Stock Analysis Report
LAWSON PRODUCTS (LAWS): Free Stock Analysis
PANDORA MEDIA (P): Free Stock Analysis Report
VULCAN MATLS CO (VMC): Free Stock Analysis
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