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This post is not to defend DRS, but to spur discussion on some CANSLIM topics.

Y/Y sales decelerating.

Yeah. Not the best now as defense spending has been cut in last 10 years. This year the defense budget has large increase and talk of even more for 2002. This falls under "N"ew.

Question. How does you balance "N" with current rev and EPS? CANSLIM stocks require a "N"ew something. Some use a new high, but that is not how I read HTMMIS (new is some basic change that will propel future rev/EPS - a new high is assumed on all CANSLIM buys). When a company has some "N" that is significant, it may take several quarters for rev/EPS to show effects. But by this time, the stock may have had it's big run and "N" will not really be "N" anymore? Just wondering how others handle this for CANSLIM stocks?

My thoughts are to not use just any stock, but if one has decent EPS/RS ratings, then great "N" and a nice base trumps mild fundie flaws. DRS has an EPS rating of 88 so it isn't a fad stock.

bouncing down off of its 50dma.

Currently true. But if the right side of base forms, the price will bounce off the 50dma as support in the handle. That offers a great base for a pivot and much less dangerous than a pivot extended from the 50dma. Comments?

2002 earnings estimate recently reduced.

This is due to additional shares from follow-on offering. Earnings estimate not lowered, but EPS is down a little. DGO and IBD appear to constantly adjust previous EPS and RPS for the current number of shares out. This means that a stock that made 50 cents per share last quarter, would show up as 45 cent per share following a 10 share increase. (I haven't figured out when they do the adjustment though.)

Therefore, if you look at the data following the share adjustment, there may appear to be accelerated growth. But if you look before the adjustment, it appears to be a future decrease coming. Has anyone figured this out and created a plan yet?

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