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FUNDAMENTAL ANALYSIS OF STOCKS?HELP ME-Mrs GV
| From : Mrs Gopal Vadivukkarasi at 03:22 PM - Jan 02, 2012 ( ) |
Share it on FacebookHai to all,
Truely speeking I am zero in fundamental analysis of stocks,so I want to learn how to analyse a stock fundamentally?What are the ratio's (or) values to be taken into consideration?and what should be their values for a good stock?,where could we get these values?,I request everybody to put your inputs.It will be an eye opener for me and many others here in Mudraa.
Thanks in advance.
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Dear Madam
Expected growth rate, yes this is very much interesting aspect to predict. Results which I mentioned for the financial year 2010-11. Get the latest three quarterly results of RIL and compare with last year results, then we can estimate expected growth rate. More over company announcements is also gives us good information, for this we have to depend on print media. Capital Market data base is also providing us some kind of information, but late information. On our own we can get the information from rediffmoney (at free of cost) for the latest results.
Mohan ji,
Thanks for your info.
Where can I get the value of expected growth rate?
Dear Madam
My Fundamental analysis is so simple
If you look into these Fundamentals you will become a good analyst.
Example: Reliance Ind
Equity 3,274.00cr
Sales 2,48,170.00cr
Np 20,286.00cr
EPS ((NP/Equity)*FV) = Rs.61.98
Current Price RS.716.00
PE (Current Price/EPS) = 11.45
Expected Growth% 25%
Current Value (PEG) PE/EG = 0.46
If RIL can earn 25% more net profit for the current financial year 2011-12, Then PEG less than .50 is discount price to buy. PEG > .50 and <1.50 is to hold. If PEG > 1.50 is to sell or to short sell.
Therefore if reliance is unable to maintain net profit growth or earning less than previous year, current price is overpriced. RIL contribution in nifty is more than 10%, drastic changes may not happen immediately.
http://www.mudraa.com/trading/93603/0/fundamental-analysis-checklist-your-weapon.html
Mr Sunil has made some insight into it
please check his messages
http://www.mudraa.com/otheruserpro.php?loginid=sramidi
I request all seniors to give me more inputs regarding fundamental analysis.
http://www.investopedia.com/university/ratios/ratios1.asp#axzz1iIgFiqRT
Some expressions of Stock Fundamental Analysis For beginning: #1- EPS: (Earnings Per Share) The portion of a company's profit allocated to each outstanding share of common stock. The amount is computed by dividing net earnings by the number of outstanding sharesof common stock. For example, a corporation that earned $10 million last year and has 10 million shares outstanding would report earnings per share of $1. #2- P/E Ratio: (Price/ EPS) Also called its "earnings multiple", Price of a stock divided by its earnings per share. The P/E ratio may either use the reported earnings from the latest year or employ an analyst's forecast of next year's earnings. P/E gives investors an idea of how much they are paying for a company's earning power. An important notice here is that the P/E ratio is ultimately not an objective measure; a high P/E ratio might show an overvalued stock, or it might reflect a company with highpotential for growth. #3- Dividend Dividend is an amount of the profits that a company pays to people who own shares in the company. When a company earns a profit, some of this money is typically reinvested in the business and called retained earnings, and some of it can be paid to its shareholders as a dividend. #4- Book Value The book value of an asset or group of assets is sometimes the price at which they were originally acquired ( historic cost ), in many cases equal to purchase price. #5- Growth Stocks Growth Stocks in finance , are stocks that appreciate in value and yield a high return on equity (ROE). Analystscompute ROE by taking the company's net income and dividing it by the company's equity. To be classified as a growth stock, analystsexpect to see at least 15 percent ROE.
Some ratios u can get here.
http://www.mudraa.com/trading/99559/0/how-to-read-balance-sheet.html
Graham is good. But u can chk rediff money for some ratios and stuff. Start reading them. But as EW says, it has got zero regard for fundamentals, why do u think it will be necessary ?
Dear Ma'am
I am an avid follower of ur posts and I congratulate u on ur amazing analytical skills.
With regards to Fundamental analysis there is one gr8 book by the name "Graham & Dodd - Security Analysis (6th ed)" which is called the bible of fundamental analysis.By the way Warren Buffet has admitted he has been greatly influenced by Ben Graham
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