“Life is too short for bad earnings and bad price performance!”

If Stocks Don’t Pass These 2 Critical Tests, Stay Away!This was the opening statement from longtime money master Jim Woods for his knockout presentation at the Investor’s Blueprint Live event in Delray Beach, Florida.

For the last two decades, Woods’s experience as a stockbroker, hedge fund analyst, financial author and journalist has granted him unique insight into the complex investing world.

As editor of the Next Week’s Winners service, Woods uses his system of relative strength and earnings-per-share rank to sniff out short-term profit potential in stocks—to the delight of his many happy (and wealthier) subscribers.

Long story short: When Jim Woods talks, investors and traders listen.

Here’s what he had to share about the importance of two critical investing factors, earnings-per-share (EPS) and relative price strength (RS), with the crowd at Investor’s Blueprint Live…

EPS is the backbone of a company because it shows growth, and RS is the prime predictor of success. Together, they are the yin and yang of Woods’s system.

“Put another way, RS is ‘what is,’ while EPS is ‘what ought to be,’” he explained.

If Stocks Don’t Pass These 2 Critical Tests, Stay Away!Finding companies with top rankings in each category can give valuable clues to stocks that can soar in the short term—that means screening companies using the 90/90 principle to find companies in the top 10% of EPS and the top 10% of RS.

Some companies Woods has found recently that meet these criteria include Facebook (FB), Ryanair Holdings (RYAAY) and Smith & Wesson (SWHC).

But that’s not all there is to it…

Before buying, you have to factor in other elements, such as when to buy, how long to hold and what drives a stock.

“You need to study chart patterns, understand the news quotient to decide what’s driving the stock, and have situational awareness or understanding of the market’s overall situation and movement,” advised Woods.

These factors have been positive recently for Facebook, which has seen a surge in users and mobile ads, and is up 7.5% since early January.

It has also worked with Smith & Wesson, which will benefit from a 44% year-over-year jump in background checks for guns in January due to political events. Its stock increase of 2.7% in 11 days doesn’t hurt, either.

Financial Expert Jim Woods

Financial Expert Jim Woods

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