To find a stock that can make you a lot of money, look for certain trends in a business. One important trend is to see if the company is making more money with the money it has. This is called Return on Capital Employed (ROCE). Another trend to watch for is if the company is using more money to make even more money. For example, we looked at Inspired Entertainment and saw that its ROCE is 15%, which is better than other companies in the Hospitality industry. This means Inspired Entertainment is doing well at using its money to make more money. It’s now making a profit after not doing so well five years ago. This company is reinvesting its profits back into the business, which could lead to even more success in the future. It’s a good idea to keep an eye on companies like this to see if they continue to do well.
Vocabulary List:
Trend /trɛnd/ (noun): A general direction in which something is developing or changing.
Profit /ˈprɒfɪt/ (noun): A financial gain especially the difference between the amount earned and the amount spent.
Reinvesting /ˌriː.ɪnˈvɛstɪŋ/ (verb): To invest again or invest an amount earned from an investment.
Industry /ˈɪndəstri/ (noun): Economic activity concerned with the processing of raw materials and manufacturing of goods.
Capital /ˈkæpɪtl/ (noun): Wealth in the form of money or assets owned by a person or organization.
Success /səkˈsɛs/ (noun): The accomplishment of an aim or purpose.
