When searching for high-quality stocks using screeners such as the GuruFocus All-in-One Screener, investors often look solely at what their chosen metrics are at the time of the search. However, it can also be useful to look at whether a company’s financial strength, profitability, growth, etc. have been improving, declining or remaining the same over time.
With GuruFocus’ historical search feature, investors can easily add historical trends to any metric that they search for by clicking on the “+” icon to the right of the metric. Using this feature, I searched for stocks whose GF Scores have improved by at least 5% per year for the past two years to reach 91 or above. I excluded the stocks that previously had lower GF Scores due to lack of sufficient reporting data.
In this discussion, we will take a look at three of the stocks that meet the GF Score growth criteria: Nike Inc. (NKE, Financial), Coterra Energy Inc. (CTRA, Financial) and Nice Ltd. (NICE, Financial). The improvements in these companies’ five key aspects of analysis indicates their businesses have been improving considerably.
Nike
Nike (NKE, Financial) had a GF Score of 85 out of 100 in mid-2021, which grew to 91 by the middle of 2022 and 95 as of this writing.
Nike’s weaker points are its momentum rank of 7 out of 10 and its financial strength rank of 8 out of 10, both of which are still fairly high compared to most companies. Its growth and profitability rank 9 out of 10, while its GF Value rank is 10 out of 10. Note that the GF Value rank is not exactly the same as the GF Value chart. The GF Value rank is based on how stocks with the same price-to-GF Value ratio have historically performed on average. 
Nike’s GF Value and growth ranks have shown the most improvement since 2021. The iconic activewear apparel and shoemaker has a three-year revenue per share growth rate of 6.30% and a three-year earnings per share growth rate of 14.6%, but the forward price-earnings ratio of 28.38 is about the same as the company’s historical average price-earnings ratio. Nike’s success in recent years has been driven by a combination of strong brand value and e-commerce strategies, which have helped pull in market share.
Coterra Energy
Coterra Energy (CTRA, Financial) had a GF Score of just 76 out of 100 in mid-2021, but its fundamentals improved across the board, bringing the GF Score to 81 in mid-2022 and 92 as of mid-2023.
The company scores best on growth and profitability with ranks of 9 out of 10, followed by a GF Value rank of 8 out of 10, a financial strength rank of 7 out of 10 and a momentum rank of 5 out of 10. The financial strength rank is particularly impressive for an oil and gas company, as players in this industry often end up with poor balance sheets due to high upfront capital investments and the cyclicality of oil and gas prices. The weak momentum has kept the GF Value chart in the significantly undervalued range.
It is no surprise that an oil and gas company like Coterra has seen profitability skyrocket. Its natural gas operations in particular have raked in profits amid high natural gas prices. Coterra’s profitability and growth ranks have shown the most improvement thanks to going in to the Covid-19 pandemic with a strong balance sheet. While financially weak competitors have had to use post-Covid profits to pay off mountains of debt, Coterra has been able to achieve a three-year revenue per share growth rate of 31.8% and a three-year earnings per share growth rate of 46.1%, all while paying a dividend yield of 8.1%.
Nice
A couple of years ago, Nice’s (NICE, Financial) GF Score was 87 out of 100. It rose to 93 by mid-2022 and reached an incredible 98 as of this writing.
Nice scores best on its momentum rank with a perfect 10 out of 10, driven by a 14-day RSI of 44.70. The growth rank is also 10 out of 10, driven by more than 20 years of steady top- and bottom-line growth, while the profitability and GF Value ranks both score 9 out of 10. The financial strength rank is lower than the others, but still very high at 8 out of 10.
Nice is an Israel-based provider of enterprise software solutions for customer engagement, fraud prevention and anti-money laundering purposes. Its GF Value and momentum ranks have improved the most over the past couple of years. The three-year revenue per share growth rate of 10.50% and three-year earnings per share growth rate of 11.60% continue a two-decade trend. Despite growth continuing strong, the company’s stock has become more attractively valued after recent declines. Improving momentum could indicate a turnaround is in the cards.
