Phil Fisher's 15 Questions

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Phil Fisher was an investor who pioneered the style of investing (stocks of publicly traded companies) based on growth prospects of companies as opposed to finding companies which might be undervalued. He used the following qualitative approach to evaluate what stocks to buy: 
A classic 



1. Does the company have products or services with sufficient market potential to make possible a sizable increase in sales for at least several years? 

2. Does the management have a determination to continue to develop products or processes that will still further increase total sales potentials when the growth potentials of currently attractive product lines have largely been exploited? 

3. How effective are the company's research and development efforts in relation to its size? 

4. Does the company have an above-average sales organization? 

5. Does the company have a worthwhile profit margin?

6. What is the company doing to maintain or improve profit margins?

7. Does the company have outstanding labor and personnel relations?

8. Does the company have outstanding executive relations?

9. Does the company have depth to its management?

10. How good are the company's cost analysis and accounting controls?

11. Are there other aspects of the business, somewhat peculiar to the industry involved, which will give the investor improvement clues as to how outstanding the company may be in relation to its competition? 

12. Does the company have a short-range or long-range outlook in regard to profits?

13. In the foreseeable future will the growth of the company require sufficient equity financing so that the larger number of shares then outstanding will largely cancel the existing stockholders' benefit from this anticipated growth?

14. Does the management talk freely to investors about its affairs when things are going well but "calm up" when troubles and disappointments occur?

15. Does the company have a management of unquestionable integrity? 


I find this method to be much more useful than buying stocks based on analysis of historical stock prices and doing sophisticated math. 


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