Key Fundamentals: Sales, Margins, Return On Equity(1)

Assess Your Knowledge
1.If a company's earnings per share growth has been accelerating for several quarters, then sales growth is not a critical factor to consider.

True
False


2.A company showing increasing profit margins is, by definition, also increasing its earnings growth.

True
False


3.Even if a company's most recent sales growth is less than 25%, at least three to four quarters of accelerating sales growth also indicates a solid trend.

True
False


4.Profit margins and ROE are often misleading performance indicators since they vary from industry to industry.

True
False


Answer

1. False
2. False
3. True
4. False