Above: Buy when annual profits are at an all time high, or are expected to be at an all time high this year. Back-and-forth profits leads to back-and-forth stocks.
The next three pages show how to manage the three questions regarding a leading stock
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What to Buy
- When to Buy
- When to Sell
The chart to the right is a retrospect view of Dell (DELL) from 1992 to 2001. The areas we will focus on are shaded in blue and represent the beginning and end of the run.
1994 was the correct year to purchase Dell stock. Note on the Annual EPS Growth at right of the chart that early investors in the stock incurred a sell signal in 1993 when Dell posted a loss. In 1994, Dell posted a record year in profits. This was the time to buy.
Let’s take a closer look at the stock back-in-the-day — at the time to buy.
