Stock Selection Models | Price Momentum and Quality Measures
Price Momentum, introduced in August 1991, is a near-term stock price performance indicator with most performance occurring in the following month to quarter. Price Momentum looks for companies with good twelve-month performance that have been consolidated or corrected in the last quarter or month.
Ford's Quality Rating, introduced in 1970, is a measure of overall financial strength and earnings stability. The general factors for this risk measure include company size, debt level, earnings history and industry stability. Ford's Quality Rating ranges from A+ to C- (B is considered average).
Ford's Earnings Variability is a unique measure of risk that tracks the historical volatility of reported earnings per share. Earnings variability is computed by finding the minimum standard error of annual earnings over the past eight years fitted to an exponential curve. Earnings variability, which is shown as a percentage of normal earnings, is a very useful indicator that can be used to evaluate future earnings and growth estimates.