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Long/Short Investments in L/S Equity: Valuation and Ideas,

314 Companies With Long-Term EPS Growth Expectations Of 10%+

The following list provides sell-side estimates of stocks that are expected to generate at least 10% in year-over-year earnings growth expectations over the next 3-5 years. A total of 314 companies are represented and all have market capitalization of at least $10 billion, so all are firmly “mid-cap” or higher based on categorization by capitalization.

This list is not meant to be taken as “recommendations” or a complete aggregation of “quality stocks.” Consensus expectations are already baked into the price of a stock and being right on future expectations is basically the way in which you “beat the market” when making directional bets.

For example, Tesla (TSLA) is worth some $50+ billion, though it has generated negative earnings, has a high cash burn rate, and is capital and R&D intensive. The median weighted bet, nonetheless, is geared toward a company that will be cash flow positive in the future such that its true value is somewhere in its current range.

The same goes for Snap (SNAP), a name also on the list where a large fraction of investors are skeptical of its ability to generate a profit and positive cash flow in the long-run to validate its present value. Without clear resolution with respect to either company’s value and wide dispersions in valuation opinions among market participants, TSLA and SNAP will continue to trade in a volatile manner.

Even so, it shouldn’t matter whether one bets on a company expected to generate -20% y/y EPS growth (i.e., contraction) or +20% y/y EPS growth so long as you get the analysis right in your favor – or anticipate near-term movements in the case of those more oriented toward trading or a short-term approach.

Double-digit EPS growers, though, may of course be more likely to be healthier companies than those with projected shrinking earnings growth and hence more likely to persist as a going concern over the long-run.

Below is the complete list, filtered alphabetically by ticker symbol, with notations of its current EPS growth assumptions (as a percentage) and market cap at the time of posting (in millions).