What is the Most readily useful Stock to Invest In?

If you're like the majority of stock market investors you have struggled with finding the very best stocks to invest in go now.

There are many methods to find the best stocks to invest in. But first you'll need to determine what method works best for you.

Basically you will find two main kinds of stock market investing

1. Investing in growth stocks

2. Investing in value stocks

Growth stocks are companies that are growing fast in earnings. There are a lot of advanced and medical growth stocks.

Value stocks are stocks that are undervalued because they trade at a cheap compared to the company's fundamentals (i.e. earnings, dividends, sales etc...)

Growth stocks generally will fatten your bank account faster but there's more risk whereas value stocks will generally grow at a slower more sustainable pace but probably won't give you ulcers.

Here's what some investors try to find in a growth stock (based on my understanding of the National Association of Investors Corporation (NAIC) criteria):

1. Strong Earnings Growth - either quarter to quarter or year over year

2. Strong Forward Earnings Growth - analysts estimate what earnings is going to be for the following quarter or year, if they estimate growth that's a plus.

3. Profit margins - you'd prefer the company to be making a large amount of profit to sustain further growth

4. Return On Equity (ROE) - try to find growth in ROE or a stable ROE

5. Doubling in 5 years or less - you'd prefer the stock to double in 5 years - look at what the analysts estimate for price potential.

Also here's what some value investors try to find:

1. Shares price below intrinsic value

2. Low Price to Earnings (P/E) ratios

3. Price to Earnings Growth (PEG) ratio below 1 is good

4. Stock price is significantly less than tangible book value

5. A debt to equity ratio below 1

6. The company's assets should be more than the company's liabilities by at the least a factor of 2

7. Dividend Yield within 1/3 of the amount of the AAA bond yield

8. Earnings growth of at the least 7% a year for days gone by 10 years

You can find a variety of different ways to find the best stock to invest in but this should offer you a starting point.