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Analyzing a stock
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Fri Sep 03 2010

Fri Sep 03 2010

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Analyzing a stock


I look to ROE, Current Ratio, Debt/Equity and earning per share growth. Roe>15%, Current Ratio >1, Debt/Equity<1 and eps growth>12 or 15% After this check, I look to the valuation. I use the last 5 years EPS growth to forecast the EPS of the next 5 years, I suppose the P/E= 5 years EPS growth (in a value approach, it is the PEG ratio and when this is <=1 a stock is undervalued), and so I see what is the total return I can get. To use this approach, it's very important the stability of EPS growth because I use it to forecast the earnings of the future. I use a personal indicator based to standard deviation to study the earning stability. Of course, the industry is the first thing I look to.


Thank you very much for that information. I am at the moment using [url]finance.yahoo.com I had some problems finding what you where talking about, could you please tell me where I would find this? What information centre do you use for your stock information?[/url]


www.multexinvestor.com It's a Reuters website and I think it's the best

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