While it should always be followed as the basic principle of investing, in markets when valuations are high it becomes extremely important for an investor to look at a company and their operating and valuation matrix separately. The reason, when there is a change in the operating matrix, the valuation matrix gets impacted more. The reason to be cautious is that when a correction takes place, and it does, stocks which have seen an improvement due to fundamental reasons tend to perform relatively well as compared to others. So look at stocks where analysts' outlook has improved over the last one month. These selected stocks depict a strong upward trajectory in their overall average score which is based on five key pillars i.e. earnings, fundamentals, relative valuation, risk and price momentum. This implies that there has been a significant improvement in their market outlook in the given time frame.
