Q: Which is the best way to calculate the annual EPS Growth Rate for a stock that has had a miss(s) over 5 years? I want to compare all stocks as per their annual EPS growth rates (actual and estimates) to find the great companies to invest in.
Here is an example of TCN's annual growth rate (no misses) over 5yrs from TD:
2013 2014 2015 2016 2017 2018 GR (%)
0.23 0.55 0.56 0.56 0.63 0.81 28.63
Here is an example of PKI's annual growth rate (with misses) over 5yrs from TD:
2013 2014 2015 2016 2017 2018 GR (%)
1.32 0.66 0.46 0.49 0.72 1.17 -2.38
Here again is PKI's annual growth rate over 3 yrs from TD, restarting the rising growth rate trend at 2015?
2015 2016 2017 2018 GR (%)
0.46 0.49 0.72 1.17 36.50
Obviously, if I use PKI's 5 yr EPS GR it would rank well down my list. However if I compare all stocks using the 5 yr EPS GR it won't penalize a company that has been intelligently growing earnings consistently? Your thoughts would be much appreciated.
Here is an example of TCN's annual growth rate (no misses) over 5yrs from TD:
2013 2014 2015 2016 2017 2018 GR (%)
0.23 0.55 0.56 0.56 0.63 0.81 28.63
Here is an example of PKI's annual growth rate (with misses) over 5yrs from TD:
2013 2014 2015 2016 2017 2018 GR (%)
1.32 0.66 0.46 0.49 0.72 1.17 -2.38
Here again is PKI's annual growth rate over 3 yrs from TD, restarting the rising growth rate trend at 2015?
2015 2016 2017 2018 GR (%)
0.46 0.49 0.72 1.17 36.50
Obviously, if I use PKI's 5 yr EPS GR it would rank well down my list. However if I compare all stocks using the 5 yr EPS GR it won't penalize a company that has been intelligently growing earnings consistently? Your thoughts would be much appreciated.