The Motley Fool's Rule Breakers, Rule Makers: The Foolish Guide to Picking Stocks

The sassy creators of the popular personal finance Web site and authors of the bestselling The Motley Fool Investment Guide (1997) now offer advice on how to evaluate the investment potential of specific companies. Here, the Gardners proffer five key principles by which to judge innovative ""Rule Breaking"" companies. Among them: ""top dog-and-first-mover in an important emerging industry"" (e.g., Amazon.com and Whole Foods Market); ""sustainable advantage due to business momentum, patent protection, visionary leadership, or inept competitors"" (Wal-Mart, Amgen); and ""smart management and good backing"" (Intuit). Yet, while the Gardners tell readers not to pay attention to analysts' expectations and earnings statements, they proceed to break their own rules, explaining that, as companies get more profitable and grow into ""Rule Makers,"" investors should look to more traditional measurements such as sales-to-debt ratios, growth, etc. The book is certainly more fun than most stock-picking manuals, and the insights into company management are amusing. In discussing the poor performance of Boston Chicken, the authors write, ""Rather than being inept, Boston Market wound up playing chicken with companies whose managers were smarter and more experienced hands at this game."" However, novice investors may find the advice more difficult to follow than previous Motley Fool books. Author tour. (Feb.)