Page 1029 - How to Make Money in Stocks Trilogy

22 HOW TO MAKE MONEY IN STOCKS—GETTING STARTED

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CAN SLIM Case Studies

A new crop of leading stocks emerges in every bull market cycle, giving you
new opportunities to make money.
Some will be household names, but many will be companies you’ve likely
never heard of. You may not be familiar with their products or services, but
now that you know the 7 CAN SLIM traits to look for, you’ll know how to
spot them—and you’ll see where to find them using the Simple Weekend
Routine (Chapter 4).
Below are profiles of 3 CAN SLIM winners.
One is a company we all know—Apple. But back in 2004 when it
launched a massive run that would turn it into the world’s most valuable
company by 2012, was it on your radar screen?
You’d probably heard of the iPod and iTunes, maybe even used them. But
as an investor, did you make the connection that with a revolutionary,
extremely popular new product (the “N” in CAN SLIM), Apple could
become a big stock market winner?
The iPod generated explosive earnings growth, and that was followed by
even more profits with the release of the iPhone. Those two game-changing
innovations revolutionized the music and mobile phone industries, leading
to a 1,418% rise in Apple’s share price in less than 4 years.
But even if you missed that entire move, Apple still offered new opportu-
nities to get in during the 2009–2012 bull market. (As you’ll see later in the
book, it’s rare for a stock that leads in one bull market cycle to come back
and lead in the next one too. That’s why it’s so important to always hunt for
the new crop of leaders. More on that later.)
Like most stocks, Apple got hammered during the 2007–2008 financial
crisis, but when the market turned around in 2009, Apple came roaring
back. What gave it that kind of power? As you can see in the case study
below, it still had the CAN SLIM traits, including big earnings and sales, hot
new products, and growing demand from fund managers. And that was
before it released yet another new innovation—the iPad.
Unlike Apple, the other two case studies, Green Mountain Coffee
Roasters and Ulta Beauty, were not household names when they launched
their big price moves. I had never heard of them before they started show-