What are good metrics to evaluate growth stocks?

I have been following the site buffettsbooks.com and it teaches you how to evaluate value stocks based on Warren Buffet's principles. These are typically stable stocks where you can predict the stock's next 10 year performance based on the previous 10 year performance.

Is there certain things one should look for when trying to evaluate growth stocks? Some of the stocks I am curious about have negative EPS and have not been trading for 10 years yet.

  • 1
    If these stocks you're looking at have not been trading 10 years, what are your criteria for a 'stable stock'? One could suggest that stable stocks have been trading for more than 20-30 years, with stable performance over the entire period. Stocks active for less than 10 years might still be benefiting from being new and exciting.
    – rbrtl
    Commented Mar 5, 2015 at 10:25
  • 4
    I don't expect many growth stocks to be as stable as value stocks. In fact I think it will be rare that you find a growth stock that is as stable as a value stock.
    – Daniel
    Commented Mar 5, 2015 at 12:57

1 Answer 1


A classic text on growth stock picking is Common Stock and Uncommon Profits By Philip Fisher, with a 15 point checklist.

Here is a summary of the list that you can check out.

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