This article from SmartMoney makes a point asserted by Peter Lynch that just because a stock has enjoyed a significant ride in price, it doesn’t mean the stock will stop rising. As Maury Elvekrog, former co-author of BetterInvesting Magazine’s “Repair Shop” column, was fond of saying, the price of a stock yesterday has nothing to do with the price tomorrow. The stock’s potential return is based on the future earnings growth and what investors are willing to pay for that growth.
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