Please enable JavaScript.
Coggle requires JavaScript to display documents.
Fundamental Analysis Knowledge Branches - Coggle Diagram
Fundamental Analysis
Knowledge Branches
earnings & sales
what
net profits
earnings = revenue/total shares
sales = revenue
stock picking considerations
EPS Growth
increase over year (same quarter)
i.e;
Q1 2018 = 40
Q1 2019 = 45
Q1 2020 = 50
Q1 2021 = 70
set a minimum increase level
above 20%
good
earning surprises
earning that has huge unexpected acceleration
exception: make sure no
nonrecurring profits
i.e selling a land, property, etc
annual growth
all quarters compared to years ago' all quarters
set a minimum increase level
above 25%, 50% better
2 continuous spiked increase is way better
Sales Growth
high earnings alone can be harmful
no research & development?
spend less in advertising?
note
don't hesitate to look EPS & Sales Growth of another stock in the same industry. See if it correlates. Find the best goods among the bests
consider low P/E ratio
doesn't always good
think of it as an insight
company is indeed undervalued
there was a huge price slam back down occured
it indicates an undervalued company
what's a good P/E ratio
under 10
company management
stock picking considerations
avoid
maintainer management
preserves traditions
don't like changes
minimum changes (low risk low reward)
not much research & development!!!
return on equity
what it says
The rate / percentage of return (money come back) of the owners of stocks of that company has.
logical explanation
most equity owned by the management
they want the best for themselves
a good ROE
at least 17%