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What should I know to explore growth investing?
Revenue, margins, expectations and valuation before treating a fast-growing business as a good investment.
- 01Understanding companies · beginnerRead guide
Revenue
Revenue is the amount recognised from selling goods or services before related operating costs are deducted. Recognition rules determine when activity enters the income statement.
- 02Understanding companies · beginnerRead guide
Profit margins
A profit margin expresses a defined profit as a percentage of revenue. It shows how much of each revenue unit remains at that stage of the income statement.
- 03Understanding companies · intermediateRead guide
Earnings per share
Earnings per share, or EPS, allocates a defined profit attributable to ordinary shareholders across a weighted share count. Diluted EPS also reflects specified potential shares.
- 04Understanding companies · beginnerRead guide
Company guidance
Company guidance is management's stated expectation or range for future performance under current assumptions. It updates the information set but remains a forecast, not a commitment.
- 05Understanding companies · beginnerRead guide
Analyst estimates
Analyst estimates are forecasts for company measures such as revenue or earnings. A consensus combines selected forecasts, but dispersion and update timing reveal information hidden by the average.
- 06Understanding companies · beginnerRead guide
What does valuation mean?
Valuation is the process of relating an asset's price to the cash, earnings, assets or outcomes it may provide. It produces a conditional estimate or comparison, not an observable fact.
- 07Understanding companies · intermediateRead guide
Competitive advantage
A competitive advantage is a capability or position that helps a company sustain attractive economics against rivals. It matters only while it remains valuable, difficult to copy and properly exploited.
- 08Understanding companies · intermediateRead guide
Share dilution
Share dilution occurs when additional ownership claims reduce an existing share's percentage interest or economic claim. New capital or compensation may still create value if used productively.