Fundamental Analysis
Price Earnings to Growth by the Numbers (Part 1 of 2)
The Price Earnings to Growth ratio is often relegated to “rule of thumb” status and doesn’t get much press despite that fact that it combines two of a stock’s most important fundamental attributes – the price to earnings ratio and forecasted earnings growth. One main issue with this metric is the fact that it is [...]
read more »Applying Fundamental Analysis: Value Investing
As you may be able to tell from the focus of my recent posts, I’ve been bitten by the value bug. After suffering a string of losses as a result of poor discipline and a several poor trading weeks, I came to the realization that I would feel much more comfortable investing in stocks with [...]
read more »Financial Analysis: Liquidity Ratios
Last we mentioned fundamental analysis, we discussed profitability ratios, a way to measure how well a company makes money. Today, we look at liquidity ratios as a way to use financial statements to glean information on how well a company can pay its short-term bills. The three most common of these ratios are the current [...]
read more »Fundamental Analysis: Profitability Ratios
Now that we’ve gone through the basics of lookings at financial statements and valuation, we can go back to ratio analysis which I attempted to write about in the first Fundamental Analysis series and failed badly at. We’ll take it a bit slower this time and try to be a bit more methodical. We’ve actually [...]
read more »Fundamental Analysis: Valuation
Valuation. Isn’t that something that financial geniuses do? Isn’t valuation for super-cool i-bankers and big shot investors? Doesn’t it take time and expertise that the average Joe just can’t commit? No, no, and… no. Valuation is really any technique used to determine the price you should pay for something. In the realm of stocks or [...]
read more »Fundamental Analysis: It’s Not All About Earnings
The first thing any investor learns about is the importance of earnings to stock prices. The simple reasoning behind this is that a business is ultimately only worth what it can earn after paying down all its obligations. Earnings, however, can be distorted by all sorts of accounting maneuvers – one time events, interest, depreciation, [...]
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