O'Shaughnessy's Take on Earnings

Quantitative strategy guru James O’Shaughnessy recently gave a primer on Yahoo! Finance’s Breakout on analyzing a company’s earnings and sales. O’Shaughnessy talks about the importance of net income, and why chasing companies with strong sales growth hasn’t been a winning strategy over the long haul. His bottom line: It’s the price you pay for a stock that really matters, not the raw earnings or sales growth rates.