The ttm finance readout on consumer discretionary stocks shows revenue growth of 7.5% YoY, supported by robust retail sales and resilient household spending patterns despite inflationary pressures. It will be interesting to monitor Microsoft's EPS in the upcoming quarter, which currently clocks in at $13.69 TTM ended in June this year. Mind you, its average EPS without NRI growth rate is at an astonishing 16% per year. We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes. Analysts expect sustained upside if inflation expectations remain sticky.
