One company that emerges from a screen based on Louis Navellier’s “Little Book That Makes You Rich” is COMFORT SYSTEMS USA INC (NYSE:FIX). The strategy is built around eight fundamental growth rules, including upward earnings revisions, consistent earnings surprises, accelerating sales, expanding margins, strong cash flow, and high return on equity. When those filters are applied, Comfort Systems USA stands out with metrics that exceed most of the required thresholds by a wide margin, making it a candidate for growth-oriented investors who follow this disciplined checklist.
How Comfort Systems USA fits the eight rules
The screen is intentionally strict, but the company’s latest figures clear nearly every bar with room to spare. Below is how Comfort Systems USA lines up against the methodology’s core criteria:
- Positive earnings revisions: The consensus EPS estimate for the next quarter has been raised by 17.15% over the past three months, comfortably above the 4% revision threshold that signals analysts are becoming more confident.
- Positive earnings surprises: The company has beaten EPS estimates in all of the last four reports, with an average beat of 35%. That consistent outperformance is exactly the kind of pattern that forces analysts to revise future estimates higher.
- Increasing sales growth: Revenue growth is 46.11% on a trailing twelve-month basis and 50.26% on a quarter-over-quarter basis, both well above the 20% minimums used in the model.
- Expanding operating margin: Operating margin has grown by 35.13% over the past year, far exceeding the 2% improvement requirement and showing that revenue growth is translating into better profitability.
- Strong cash flow: Free cash flow growth over the past year is 247.45%, against a 15% filter. This gives the company ample financial flexibility to fund growth internally.
- Earnings growth: EPS growth is 108.94% on a TTM basis and 91.88% quarter over quarter, easily surpassing the 15% thresholds and reinforcing the growth thesis.
- Positive earnings momentum: The most recent quarter-over-quarter EPS growth of 91.88% is above the 74.60% recorded four quarters ago. That acceleration is precisely what the methodology looks for when confirming momentum.
- High return on equity: ROE stands at 44.58%, well above the 10% minimum and indicative of management’s ability to generate strong returns on shareholder capital.
Meeting all eight conditions at once is notable. The screen is designed to identify companies that are not just growing, but doing so with improving fundamentals, analyst support, and operational efficiency. Comfort Systems USA appears to check each of those boxes, which is why it is relevant for investors following this approach.
A strong fundamental profile beyond the screen
The broader fundamental picture reinforces the screen’s findings. The ChartMill fundamental analysis gives Comfort Systems USA an overall rating of 8 out of 10, with sub-scores of 9 for profitability, 8 for health, and 9 for growth. In particular, the company shows a return on invested capital of 39.10%, a profit margin of 12.78%, and an operating margin of 16.45%, all of which rank near the top of the Construction & Engineering industry. Its Altman-Z score of 9.54 indicates a very low bankruptcy risk, while a debt-to-FCF ratio of 0.03 means debt is negligible relative to free cash flow.
The valuation sub-score is the weakest part of the profile at 5 out of 10, driven by a trailing P/E ratio of 42.54 and a forward P/E of 29.72. However, the PEG ratio based on expected forward earnings growth of 36.66% suggests the premium may be justified. Growth-oriented strategies such as this one often tolerate higher multiples when the underlying earnings momentum is this strong. Investors who want to review the full fundamental breakdown can use this fundamental analysis page.
Risks to keep in mind
Even with a strong fundamental setup, there are limitations. The screen relies entirely on published historical data, and while estimates point to continued growth, those forecasts can change quickly. The construction and engineering sector is also sensitive to economic cycles, project timing, and material costs. A slowdown in capital spending or a rise in input prices could pressure margins and slow the growth trajectory. Additionally, the stock’s elevated valuation leaves less room for error if growth decelerates faster than expected.
Investors who want to find more stocks that pass this exact methodology can explore the full list of current matches on this screen. As with any quantitative approach, the filters serve as a starting point for further research rather than a complete buy signal.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
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Comfort Systems USA (NYSE:FIX) Passes All Eight Growth Rules With Strong Fundamentals
One company that emerges from a screen based on Louis Navellier’s “Little Book That Makes You Rich” is COMFORT SYSTEMS USA INC (NYSE:FIX). The strategy is built around eight fundamental growth rules, including upward earnings revisions, consistent earnings surprises, accelerating sales, expanding margins, strong cash flow, and high return on equity. When those filters are applied, Comfort Systems USA stands out with metrics that exceed most of the required thresholds by a wide margin, making it a candidate for growth-oriented investors who follow this disciplined checklist.
How Comfort Systems USA fits the eight rules
The screen is intentionally strict, but the company’s latest figures clear nearly every bar with room to spare. Below is how Comfort Systems USA lines up against the methodology’s core criteria:
Meeting all eight conditions at once is notable. The screen is designed to identify companies that are not just growing, but doing so with improving fundamentals, analyst support, and operational efficiency. Comfort Systems USA appears to check each of those boxes, which is why it is relevant for investors following this approach.
A strong fundamental profile beyond the screen
The broader fundamental picture reinforces the screen’s findings. The ChartMill fundamental analysis gives Comfort Systems USA an overall rating of 8 out of 10, with sub-scores of 9 for profitability, 8 for health, and 9 for growth. In particular, the company shows a return on invested capital of 39.10%, a profit margin of 12.78%, and an operating margin of 16.45%, all of which rank near the top of the Construction & Engineering industry. Its Altman-Z score of 9.54 indicates a very low bankruptcy risk, while a debt-to-FCF ratio of 0.03 means debt is negligible relative to free cash flow.
The valuation sub-score is the weakest part of the profile at 5 out of 10, driven by a trailing P/E ratio of 42.54 and a forward P/E of 29.72. However, the PEG ratio based on expected forward earnings growth of 36.66% suggests the premium may be justified. Growth-oriented strategies such as this one often tolerate higher multiples when the underlying earnings momentum is this strong. Investors who want to review the full fundamental breakdown can use this fundamental analysis page.
Risks to keep in mind
Even with a strong fundamental setup, there are limitations. The screen relies entirely on published historical data, and while estimates point to continued growth, those forecasts can change quickly. The construction and engineering sector is also sensitive to economic cycles, project timing, and material costs. A slowdown in capital spending or a rise in input prices could pressure margins and slow the growth trajectory. Additionally, the stock’s elevated valuation leaves less room for error if growth decelerates faster than expected.
Investors who want to find more stocks that pass this exact methodology can explore the full list of current matches on this screen. As with any quantitative approach, the filters serve as a starting point for further research rather than a complete buy signal.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
Read full article here »