EPS: Earnings Per Share
EPS (Earnings Per Share) is a company's net profit divided by its shares outstanding. What matters is not the absolute EPS but its growth.
Example: if EPS was $1.50 a year ago and is $2.00 today, year-over-year (YoY) growth is +33%. That tells institutions they have concrete reasons to keep buying.
The EPS growth the scanner evaluates:
- Good: EPS YoY ≥ 10% — the company is clearly growing earnings
- Neutral: EPS YoY between 0% and 10% — growing, but slowly
- Bad: EPS YoY negative — earnings are declining
Revenue: sales growth
Revenue is total money coming in before any cost deductions. High EPS can be engineered through cost-cutting or buybacks — not because the business sells more. That's why Revenue YoY complements EPS: if both are growing, the business has real market traction.
The Revenue growth the scanner evaluates:
- Good: Revenue YoY ≥ 15%
- Neutral: Revenue YoY between 5% and 15%
- Bad: Revenue YoY below 5% or negative
A company with Revenue +20% and EPS +30% has the compounding growth profile that generates the largest moves in momentum investing.
Earnings Surprise: beating estimates
The market doesn't react to absolute numbers — it reacts to the difference between what it expected and what happened. A company earning $2.00 when consensus expected $2.20 can fall even if it's a record EPS. One earning $1.80 with a $1.60 estimate can rally.
That difference is the Earnings Surprise: the percentage by which actual EPS exceeded (or missed) analyst estimates.
- Positive surprise: actual EPS > estimate → generally a good price catalyst
- Negative surprise (miss): actual EPS < estimate → typically triggers sharp drops
The scanner evaluates the average surprise across the last 4 quarters. The best momentum signals combine growing EPS with consistent positive surprises.
Beats Ratio: quarterly consistency
The Beats Ratio is what fraction of recent quarters a company exceeded consensus estimates. If it beat in 3 of the last 4 quarters, its beats ratio is 75%.
A beats ratio ≥ 75% means the company consistently outperforms — it wasn't an isolated quarter. That's what the scanner requires to mark a stock as "GOOD" in fundamentals.
What "Fund: GOOD" means in the dashboard
The fundamental score combines the four factors into a number from 0 to 10:
- Revenue YoY: up to 2 pts (≥15% → 2, ≥5% → 1)
- EPS YoY: up to 2 pts (≥10% → 2, >0% → 1)
- Earnings Surprise average: up to 2 pts (>5% → 2, >-5% → 1)
- Beats Ratio: up to 2 pts (≥75% → 2, ≥50% → 1)
- EPS + Revenue trend growing: up to 2 pts
The result is normalized against available provider data:
- GOOD: normalized score ≥ 7 — clear growth across most factors
- NEUTRAL: score 3-6 — growing but with inconsistencies
- BAD: score < 3 — no growth or deteriorating
For Gems, the scanner requires "GOOD" as a mandatory filter. For Opportunities, it accepts "NEUTRAL" — candidates still building their growth track record.
How to verify before entering
When the scanner shows "Fund: GOOD" and you want to confirm: look up the symbol on any financial platform and review the last 4 quarters of EPS and Revenue. Verify growth is consistent, not just one isolated good quarter. If earnings are within the next 21 days, the scanner adds a risk warning — factor that into your position sizing.