Newsletter guru Jim Oberweis says that when it comes to growth investing, keep it simple.
“After studying small-cap growth stocks for the past 20 years, I’ve seen the benefits of simplicity and clarity,” Oberweis writes in Forbes. “For companies in rapid-growth mode half the battle lies in defining the growth strategy, while the other half lies in its execution. Everything is made easier when the plan is straightforward and clearly understood by both employees and investors.” A simple plan, he says, “helps to align the team, measure results and compensate employees for success. [And] from the investor’s perspective a simple story helps investors understand the business, track its progress and distinguish between effective execution and luck (as well as to quickly recognize when trouble is brewing).”
Oberweis looks at a few of his current favorite simple- growth-story stocks. Among them: RetailMeNot, the world’s largest digital-coupon marketplace.
Validea’s small-cap growth Motley Fool-inspired portfolio is up 16.0% annualized since its mid-2003 inception vs. 6.4% for the S&P 500. Check out its holdings here.