How do I use my Weekly TSA Newsletter?
There are several ways to use TSA. You can use it as a stand-alone service and buy the recommendations or you can combine it with technical analysis. We believe combining technical analysis with great fundamental stocks can improve the performance of any portfolio. Remember institutional investors determine what they will buy based upon fundamentals. Since they comprise 90% of the market, it would only seem proper to start with good fundamental stocks. Then use technical analysis to determine a good entry point. Over time you will see better performance from your portfolio.
What is Market Capitalization Ranking?
The market seems to favor different market capitalization stocks from time to time. This ranking enables you to focus on the capitalizations which are likely to lead the markets advance in the coming weeks.
Explanation of Terms
%Chg. EPS F1 – This shows the percentage change in the current fiscal year earnings estimates over the past four weeks. Revision greater than 1.00% have one of the greatest impact on stock prices.
EPS Grth% F1 – This shows the projected earnings per share growth for the current year. Growth of earnings can differ between industries. Stocks with the highest growth rates are not always the biggest winners.
EPS Grth% F2 – This shows the projected earnings per share growth for the current and next fiscal year. Growth of earnings can differ between industries. Stocks with the highest growth rates are not always the biggest winners.
Anlst in F1 Con. Est. – This is the number of analyst following the stock. Stocks with 4 or more analysts typically have a lower uncertainty of earning.
P/E using F1 Est. – This is the price to earnings ratio of the stock using the current fiscal year earnings estimate.
Mkt Cap $ Millions – This is the total market capitalization based upon outstanding shares.
FATI® Score – This is a scoring metric use to determine the dispersion of the earnings estimates. The lower the FATI® Score the lower the earnings uncertainty is for a stock. Any stocks scoring higher than ten are immediately disqualified.
Next EPS Report Date – This alerts you to the next earnings announcement date for a stock.
What is an ‘Earnings Estimate?
An earnings estimate is an analyst’s estimate for a company’s future quarterly or annual earnings. Future earnings estimates are arguably the most important input when attempting to value a firm. By placing estimates on the earnings of a firm for certain periods (quarterly, annually, etc), analysts can then use cashflow analysis to approximate a fair value for a company, which in turn will give a target share price for publicly traded companies.
Analysts use forecasting models, management guidance and fundamental information on the company in order to derive an estimate. Market participants rely heavily on earnings estimates to gauge a company’s performance when announcing quarterly or annual results. The analysts’ earnings estimates are used as a benchmark to measure a firm’s performance relative to how experts expected it would do.
What is a consensus estimate?
A consensus estimate is a figure based on the combined estimates of the analysts covering a public company. Generally, analysts give a consensus for a company’s earnings per share and revenue; these figures are most often made for the quarter, fiscal year and next fiscal year. The size of the company and the number of analysts covering it will dictate the size of the pool from which the estimate is derived.