But in investing, the desire to break up abstract investment concepts and examine them separately instead of looking at the entire business and market picture as a whole can lead to problems. Companies are not machines. They are more like living organisms, and thus properly analyzed holistically, rather than in parts. In the same vein, a company's share price is every bit as fundamental to an investor as the firm's margins or earnings growth rate. The key is to look at these two measures in conjunction with all of the Foolish 8 screens and not in isolation.
Anomalies do occur, of course.
Likewise, a relative strength reading greater than 90 can be viewed as an affirmation by the market of the strength of a company's fundamental story. The fact that the company in question has made it through the other Foolish 8 screens will back this up. High relative strength in this case may signify that a firm's fundamental value creation ability is being recognized by the market in the form of an outperforming share price. And that's a good thing for a small company, whose fundamental business performance has a greater chance of being missed by investors. The important point is not to look at single-shot measures like share price or relative strength in a vacuum.