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Does CANSLIM + Earnings Acceleration actually work?

DEAD

No edge left once tested on a fair footing.

The claim

Requiring earnings growth to be ACCELERATING on top of price leadership sharpens the screen — Earnings-momentum crowd

What we did

Tested against Equal-weight survivorship-free peer universe + SPY, net of cost, 2003–2026, OOS ≥ 2021.

The result

Result: -0.1 net-αSPY %/yr (beats index net of cost)

vPEERS +3.6 vs base +5.0; net-αSPY −0.1 vs +6.1%/yr

Verdict

Same lesson as the sector overlay: bolting an earnings-acceleration filter onto a price screen shrank it without adding edge (+3.6 vs +5.0). Earnings acceleration ALONE is worse than random (+−0.6 over peers). By the time earnings confirm, the price already moved — the story is redundant with relative strength.

What the test did and did not do

survivorship-free universe
net of real costs
tested out of sample
point-in-time data
checked for look-ahead

Almost nobody publishing a backtest says which of these they did. We list the ones we failed as well as the ones we passed.

Tested 2026-06-23. The same treatment, applied to every other system, is on the test bench.

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Written with AI assistance from our own test database. The numbers are computed, not composed.
General market commentary for education, not personalised investment advice. Backtested results are hypothetical. Trading carries a real risk of loss.