The G-Score is a financial analysis framework created by Professor Partha Mohanram in 2005 to evaluate growth stocks, complementing the F-Score system that Joseph Piotroski developed for value stocks. It examines eight key indicators of a company’s financial health, with special attention to metrics that matter most for growth companies.
The system looks at how consistently a company invests in its future through R&D, capital investments, and advertising. It also considers profitability metrics like return on assets and operational cash flow. For each positive indicator, a company receives one point, adding up to a possible total of eight points. Companies with higher scores are considered to have stronger growth potential.
What makes the G-Score particularly valuable is its focus on sustainable growth rather than just rapid growth. When Mohanram tested the system, he found that investors could generate above-market returns by buying stocks with high G-Scores while shorting those with low scores. This approach helps identify companies with lasting competitive edges, distinguishing them from businesses experiencing temporary success or facing intense competition.
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Here are Validea’s top 10 G Score stocks for February 2025.
| Ticker | Company Name | Price | Market Cap ($mil) | PE Ratio | Price/ Sales | Relative Strength | Price/ Book | Price/ Cash Flow | Dividend Yield | Mohanram G Score |
|---|---|---|---|---|---|---|---|---|---|---|
| AMZN | AMAZON.COM INC | $238.83 | $2,511,300 | 43.3 | 3.9 | 79 | 8.9 | 22.4 | 0.0% | 8 |
| AVY | AVERY DENNISON CORP | $181.68 | $14,597 | 20.8 | 1.7 | 42 | 6.3 | 14.4 | 1.9% | 8 |
| BIDU | BAIDU INC (ADR) | $88.81 | $31,141 | 11.1 | 1.7 | 39 | 0.9 | 7.8 | 0.0% | 8 |
| BOX | BOX INC | $34.48 | $4,955 | 43.0 | 4.6 | 73 | 1.9 | 27.8 | 0.0% | 8 |
| DECK | DECKERS OUTDOOR CORP | $172.19 | $26,134 | 28.0 | 5.3 | 71 | 9.9 | 25.9 | 0.0% | 8 |
| EXEL | EXELIXIS INC | $33.67 | $9,615 | 21.5 | 4.6 | 87 | 4.2 | 19.4 | 0.0% | 8 |
| JNJ | JOHNSON & JOHNSON | $153.51 | $369,594 | 26.5 | 4.2 | 48 | 0.8 | 23.0 | 3.2% | 8 |
| LII | LENNOX INTERNATIONAL INC | $585.38 | $20,837 | 26.0 | 3.9 | 77 | 24.5 | 23.1 | 0.8% | 8 |
| MAT | MATTEL INC | $21.43 | $7,220 | 13.5 | 1.3 | 65 | 3.2 | 10.5 | 0.0% | 8 |
| NOW | SERVICENOW INC | $1,023.30 | $210,800 | 149.7 | 19.2 | 74 | 22.0 | 106.0 | 0.0% | 8 |
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