Looking for steady long-term earnings and sales growth? ServiceNow (NOW), Chipotle Mexican Grill (CMG), Fortinet (FTNT), Cadence Design Systems (CDNS), Intuit (INTU), Paycom Software (PAYC), Insulet (PODD) and Aptiv (APTV) appear in Goldman Sachs’ “Rule of 10” stock screens for revenue and profits.
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Steady, long-term growth is a hallmark of IBD Long-Term Leaders. Fortinet and CDNS stock are Long-Term Leaders.
Chipotle is currently in a buy zone. ServiceNow stock and Cadence Design are actionable from a 21-day line bounce. Intuit stock is just below key resistance in a long base.
S&P 500 Stocks On Both ‘Rule Of 10’ Screens
| Company | Ticker | Sales growth (CAGR) | Net income growth (CAGR) |
|---|---|---|---|
| ServiceNow | NOW | 22% | 26% |
| Paycom Software | PAYC | 21% | 23% |
| Fortinet | FTNT | 21% | 20% |
| Insulet | PODD | 19% | 33% |
| Chipotle Mexican Grill | CMG | 14% | 24% |
| Intuit | INTU | 13% | 15% |
| Cadence Design Systems | CDNS | 12% | 15% |
| Aptiv | APTV | 11% | 30% |
Source: Goldman Sachs
Rule Of 10 Sales Growth
Goldman’s original “Rule of 10” model focuses on S&P 500 stocks with at least 10% sales growth in the prior two years, with that minimum pace expected for the next three years.
Some 20 stocks meet this sales criteria: Enphase Energy (ENPH), Tesla (TSLA), SolarEdge Technologies (SEDG), Palo Alto Networks (PANW), NOW stock, Paycom, FTNT stock, DexCom (DXCM), Insulet, Axon Enterprise (AXON), Arista Networks (ANET), Ceridian (CDAY), CMG stock, Intuit, Adobe (ADBE), Cadence Design, Monster Beverage (MNST), Starbucks (SBUX), APTV stock and Salesforce.com (CRM).
Rule Of 10 Earnings Growth
Another “Rule of 10” screen looks at S&P 500 stocks with 10% or more net income growth over the 2021-2025 period. Some 18 stocks fit the bill here.
Baker Hughes (BKR), Match Group (MTCH), PODD stock, Aptive, Booking Holdings (BKNG), ServiceNow, Schlumberger (SLB), Chipotle, PAYC stock, Halliburton (HAL), Fortinet, Howmet Aerospace (HWM), Cadence Design, Xylem (XYL), INTU stock, Autodesk (ADSK), UnitedHealth Group (UNH) and Molina Healthcare (MOH).
Among those appearing on at least one screen, Tesla stock and Palo Alto Networks are on IBD Leaderboard, with CMG stock on the Leaderboard watchlist. NOW stock is on SwingTrader. Chipotle, ServiceNow and CRM stock are on the IBD 50. Chipotle, Fortinet, Booking Holdings, Tesla and PANW stock are on the IBD Big Cap 20.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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