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๐—จ๐—ป๐—ฑ๐—ฒ๐—ฟ๐˜€๐˜๐—ฎ๐—ป๐—ฑ๐—ถ๐—ป๐—ด ๐—ฆ๐˜๐—ผ๐—ฐ๐—ธ ๐—™๐˜‚๐—ป๐—ฑ๐—ฎ๐—บ๐—ฒ๐—ป๐˜๐—ฎ๐—น๐˜€: ๐—ฌ๐—ผ๐˜‚๐—ฟ ๐—ฃ๐—ฎ๐˜๐—ต ๐˜๐—ผ ๐—ฆ๐˜‚๐—ฐ๐—ฐ๐—ฒ๐˜€๐˜€ ๐—ฎ๐˜€ ๐—ฎ๐—ป ๐—”๐—ป๐—ฎ๐—น๐˜†๐˜€๐˜

Stock fundamentals are key metrics and info that help investors and analysts determine the intrinsic value of a company's stock. Students aspiring forย hashtag#investmentbankingย andย hashtag#globalmarketsย roles must know these basics to get insights into the firm's financial health, performance, and prospects even before complex financial modeling:

๐—–๐—ผ๐—บ๐—บ๐—ผ๐—ป ๐—ฆ๐˜๐—ผ๐—ฐ๐—ธ ๐—™๐˜‚๐—ป๐—ฑ๐—ฎ๐—บ๐—ฒ๐—ป๐˜๐—ฎ๐—น๐˜€:

โžก๏ธEarnings and Revenue: Crucial indicators of its financial performance.ย 

โžก๏ธDividends: Payments made to shareholders from company profits. These are similar to regular payouts, like interest in a savings account, offered by companies from their profits.

โžก๏ธCash Flow: Cash flow represents the amount of money flowing in and out of a company. A positive cash flow indicates that a company is generating more cash than it is spending. This is essential for the firmโ€™s operational and investment activities.

โžก๏ธPrice-to-Earnings (P/E) Ratio: A valuation ratio that compares the current stock price to earnings per share. It helps assess whether a stock is overvalued or undervalued. These ratios gauge a companyโ€™s share price relative to its earnings per share. For instance, a P/E ratio of 20 indicates that the investors pay $20 for each $1 of earnings. One can find the P/E ratio by comparing the latest market price with the cumulative earnings of the previous 4 quarters.

โžก๏ธPrice-to-Book (P/B) Ratio: It compares a stock's market value to its book value, indicating whether a stock is under or overvalued.

โžก๏ธDebt Levels: Understanding a company's debt and how it's managed is crucial.

โžก๏ธBalance Sheet: The balance sheet offers a good look of a company's financial position at a specific point in time.ย 

โžก๏ธReturn on Investment (ROI): ROI measures the profitability of an investment relative to its cost.

โžก๏ธReturn on Equity (ROE): This evaluates a company's ability to generate profits from shareholders' equity.

โžก๏ธMarket Capitalisation: The total value of a company's outstanding shares.

Stock fundamentals also provide insights into the long-term prospects of an organisation plus any risks associated with investing. Since markets may not be efficient at accurately pricing stocks, fundamental analysis is more reliable in identifying overvalued or undervalued opportunities.

3 Stock Essentials

1๏ธโƒฃ Company Research: How the company makes money? Dig deeper into what kind of services they offer or what they manufacture, how many countries they operate in, their flagship product and its sales, and whether they are considered a leader in the industry?

2๏ธโƒฃ P/E Ratio

3๏ธโƒฃ Beta: The measure of a companyโ€™s stock volatility over the last 5 years in comparison to the overall market. Beta is found alongside the P/E ratio on stock research pages. Defensive stocks usually have a low beta (less than 1.0)

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