How to Spot a Winning Stock

Matthew Carr
by Matthew Carr, Emerging Trends Strategist, The Oxford Club
Happy celebrating winning success woman sunset

Peter Lynch once said, "Investing without research is like playing stud poker and never looking at the cards."

If you're wary of doing hard work - of getting your hands dirty doing some research - then I don't think investing is for you.

It's not a game. Or a gamble.

I know people who complain that the market is "rigged" or that the "odds are stacked against you."

That you can't win.

I disagree...

On Wednesday, Smith & Wesson Holding Corp. (Nasdaq: SWHC) shot up 16%...

A week before that, Abercrombie & Fitch (NYSE: ANF) popped 11.25%...

OmniVision Technologies (Nasdaq: OVTI) shot up more than 13%...

From its close on February 13 to the end of trading on Valentine's Day, Cray (Nasdaq: CRAY) soared 39%...

And two days before Cray's big move, Conversant (Nasdaq: CNVR) - formerly ValueClick - spiked 17%...

These were all one-day moves. Big single-day surges. Now, were investors in these companies just lucky? Did they just happen to be in the right place at the right time?

Was it merely chance?

Or is there a way to predict which companies are going to not only beat Wall Street expectations - but actually obliterate them?

I'll let you in on something: Because of peculiar trends in their stock price after earnings releases, most of these companies I mentioned were in my Oxford Club trading service, Emerging Trends Trader.

Let's look at a chart of Cray's quarterly revenue...


It was estimated to make $300 million in the fourth quarter of 2013. On February 13, the supercomputer maker reported $307 million...

Abercrombie & Fitch's quarterly revenue chart looks similar to Cray's...


But if you take a few extra moments - if you spend a little time digging - you start finding even more valuable pieces of information.

One of them: Since 2008, during the trading day following its fourth-quarter earnings release (including this year), shares of ValueClick/Conversant have gained double digits four times out of six.

And only once in those six years did shares fall on its fourth-quarter report.

That's a handy - and profitable - piece of information, uncovered by a bit of research, to have in your back pocket.

And if you're willing to dig even deeper, you'll discover that there are real reasons why these pops happen.

It's also handy to know that, since 2008, shares of Conversant have never risen following the company's second quarter release.

Investing isn't all gut feelings, whims and trying to hopefully channel "the Midas touch."

It's about research.

It's about taking the time to understand what moves the shares of the companies you are investing in and why... Knowing where the trouble spots are... Understanding when the best time to buy is...

That's how you make money investing.

Otherwise, save yourself the frustration and just buy lottery tickets.


Good investing,



P.S. Good research is the difference between investing and gambling. But knowing how to do good research - knowing what to look for - is just as important. The gains described above (and dozens more like them) were all made possible by a crucial discovery I made over the course of my career. And on March 18, during a special one-day event, I'll reveal exactly how I find these jaw-dropping opportunities... but only to a very limited number of investors. To learn more, click here.

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The Value of the Right System

In any market, if you have a smart investing system and follow it ruthlessly, you'll win. Matt will reveal his methods on March 18 to a small group of investors. Another such system is Marc Lichtenfeld's Stock Trading Analytical Research System (S.T.A.R.S.).

S.T.A.R.S. is a cold-blooded analytical software program that spits out winner after winner based on a set of metrics selected by Marc. He reviews the stocks identified by S.T.A.R.S. and recommends the very best ones to his Oxford Systems Trader subscribers.

Here's an example. When Marc saw Wabash National Corp. (NYSE: WNC) in November, he jumped. And it's a good thing he did. The stock is up almost 18% since then.

To understand how the system works, take a look at what Marc told us about Wabash National:

"The Lafayette, Ind.-based company makes truck trailers and other transportation related products, which should do well as the economy continues to improve.

"Performance has already been strong. S.T.A.R.S. picked up on Wabash National because of its strong 46% return on equity (the highest of any stock that qualified under S.T.A.R.S), a five-year average cash flow growth rate of 30% and a higher inventory turnover than the industry average, among other metrics.

"Like many of our positions, this is not a stock that is in the news a lot. So don't expect to hear Maria Bartiromo talking about it on CNBC.

"But like many of our other stocks, it's a rock-solid company that should deliver strong results to shareholders."

- Bob Keaveney with Marc Lichtenfeld

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