People look at all kinds of different things when deciding to purchase a stock. Past pricing, buyout rumors, press releases from the company, other big news items. But often people overlook the single most important thing. Profits. Too often people lose track of the fact that a public company is a business enterprise. Would they buy a convenience store or other business that was a money loser? Probably not. But people do this with stocks every day.
There are exceptions, with something like a bio-tech stock. It will lose money for years, then suddenly make profits from their drugs. But even there several should be purchased because it’s unknown which ones will succeed. I see people buying telecommunications companies, internet companies and restaurant chains that aren’t making money and probably never will. No matter how neat a business sounds, they can’t stay in business losing money.
On the other hand, if a company makes money they can withstand any drop in the stock market or other bad news. A company can go on indefinitely as long as it is profitable. Not a bad idea to keep in mind when looking at a stock.