Growth Gems: 7-Point Recipe

Buys by the recipe that the score ladder of our growth back-test singled out as the strongest rung: stocks with EXACTLY 7 of the Growth Check's 10 points — no more and no less. The same ten criteria apply as in the Growth Check: revenue growth over three years and for the coming year, a share count that barely grows, the "Rule of 40", a stable gross margin of 40 percent or more, goodwill that does not grow faster than revenue, debt below twice operating profit, cash flow that covers profits, a return on capital of 15 percent or rising, and insiders who hold or keep buying. Over January 2000 to July 2026 that exact rung beat both "8 or more" and "9 or more" points — more points did not mean more return there. Only shares our own deep-dive analysis rates green are bought — yellow or no analysis at all is not enough. New positions are added once a month; a share is sold as soon as it leaves the seven points or is no longer rated green. The fixed stop 15 percent below the entry price and the six-month re-entry lock that the back-test also calculated are not reproduced by this portfolio — they remain rules for your own. If the list holds no green-rated share, the portfolio stays in cash.

This portfolio buys shares.