Dumb embarassing question:
what does year over year and month over month mean?
Dumb embarassing question:
what does year over year and month over month mean?
I think the term comes from the way it’s calculated…
yoy sales growth = (year 1 sales / year 0 sales ) - 1
y/y is compared to same period in the previous year. Month over month or quarter over quarter is sequential (compared to previous month or quarter).
Right. Year over year helps control a bit for seasonality effects, and automatically annualizes the figure.
Something that should be covered in CFA level 1.
Everyone else said this so I will just add some context:
YOY or Y/Y is relevant particularly for growth stocks because people want to see how the growth is tracking relative to the same seasonal period last year.
For non-seasonal or hyper growth stocks the Street will sometimes (but rarely) focus more on Q/Q numbers to see how the growth is occurring regardless of seasonality (if any). Some high flying stocks like SaaS stocks are modeled, valued, and tracked on Q/Q numbers.