What do Company Tags look like & how they affect your investment decision? Cyclical The fortunes of Cyclical companies tend to be linked with economic cycles. Such companies can be risky to invest in. They can offer high returns but the trick is in catching them at the Right Price and Right Time. Example: NMDC Stalwarts Stalwarts are the mature companies that are capable of generating good profits. They typically tend to have a portfolio of strong brands - diversified for different markets. Example: ITC Fast Grower Fast Grower stocks are what every investor is hunting for. Which company is likely to grow multi-fold in the next few years? Growth stocks lie in emerging sectors as the entire sector is in a growth phase and has enough steam to pull the stocks along. Example: Divis Labs Value Value stocks are another popular group among fundamental investors, because their market cap is lower than the value of their assets. This makes them bargain-buys for a savvy investor. Example: SAIL Slow Grower Slow Growers are incapable of rapid expansion & unable to milk a growth sector. Since its profits are not reinvested for growth, they tend to return them to investors by paying them high dividends. Example: HUL Question Marks The Question Mark tag is assigned to companies that seem to have lost or are on the verge of losing their way. These companies may have been Fast Growers/Slow Growers at some point but have seen questionable value creation over the past few periods and face an uncertain future. Example: Tata Steel Turnarounds A turnaround company is one which has been battered on all fronts but is capable of making a comeback. Think of companies which are being spun off or are undergoing restructuring activities. Example: Wockhardt
Posted on: Wed, 11 Sep 2013 05:12:36 +0000
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