How many Fools believe, as I am coming to, that a quick ratio below 1.0 indicates a company too willing go into debt to fund operations, while a quick ratio higher than 2.0 indicates a company too UNWILLING to take risks?
Should the latter variety either increase it's dividend, spend more to enhance growth prospects, or both?
I do not believe even income oriented investors should buy stocks with payout ratios higher than 20-25%. Such high ratios can end up forcing the company to go deeper into debt than is healthy which is not good whatever one's investment goal may be. Ergo I will rarely, if ever, green thumb such stocks and may end picks if the payout ratio goes that high for whatever reason.
In future I plan to red thumb mostly stocks with market caps above $1,000,000,000. Such stocks, IMO, appeal mostly to people who mistake size for safety. I if anything, may be prone to the opposite mistake of mistaking size for overvaluation, but I am vain enough to believe I don't make that mistake very often. Less often than I once did anyway.
I intend in future to green thumb only stocks the "ratios" page says have positive free cash flows and lower than industry average P/FCFs. Other stocks will get red thumbs idf I pick them at all.
How would other Fools like it if the 7 day rule got changed to one where no pick could be ended until it had gained or lost at least 50 points?
Another idea I've had would be charging a 50 point "commission" to start a pick, with another, sliding scale "commission" to end a pick active less than 200 trading days.