"Is this a good buy?" is really four questions wearing one coat. A stock that passes three and fails one can still lose you money — which is why a checklist beats a feeling.
Revenue growing over years, real profits (not just one good quarter), return on equity above ~15%, debt that a couple of bad years couldn't turn fatal, cash actually being generated. No chart pattern rescues a deteriorating business for long.
A great business at 200× earnings has already been paid for its next decade. Compare the P/E against the company's growth and its own history. The question is never "is this a good company?" — it's "how much of the future am I paying for today?"
An uptrend above the key averages means the market shares your view; a confirmed downtrend means it doesn't — and the market can stay wrong longer than you can stay patient. Buying quality after its chart stabilises gives up a few percent for a lot of certainty.
Good buys sit at the overlap: decent business, defensible price, chart not fighting you, position sized so being wrong is survivable. Anything missing one of the four is a compromise — sometimes worth making, but only knowingly.
▶ Check any stock free →Educational only — not financial advice. This guide explains general concepts for learning purposes and is not a recommendation to buy or sell any security. Always do your own research and consult a licensed financial adviser before investing.