Growth investors focus on one aspect of a company: is potential for any growth. They believe that the companies with high earnings growth will see their stock price continue to increase, since investors will want to own profitable companies that can pay large dividends in the future. The number that they pay the most attention to earnings per share, especially how it changes from year to years, although the sometime look at revenue growth as well. Some investors also compare the price/earnings ratio with the annual earnings growth, to get a feel for how much the market is willing to pay for a given rate of earning growth. Growth stocks tend to be from young companies, so they are often riskier than the average stock. They have the potential to large gains, but they also have the potential for large losses.
