What Is Fundamental Analysis?
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Fundamental analysis is a method of measuring a security's intrinsic value by examining related economic and financial factors. Fundamental analysts study anything that can affect the security's value, from macroeconomic factors such as the state of the economy and industry conditions to microeconomic factors like the effectiveness of the company's management.
The end goal is to arrive at a number that an investor can compare with a security's current price in order to see whether the security is undervalued or overvalued.
This method of stock analysis is considered to be in contrast to technical analysis,which forecasts the direction of prices through an analysis of historical market data such as price and volume.
What are the steps in fundamental analysis?
Broadly speaking, fundamental analysis evaluates individual companies by looking at the firm's financial statements and examining various ratios and other metrics. This is used to estimate a company's intrinsic value based on its revenues, profit, costs, capital structure, cash flows, and so forth. Company metrics can then be compared with industry peers and competitors. Finally, these can be compared to the broader market or larger economic environment.
Who uses fundamental analysis?
Fundamental analysis is used largely by long-term or value investors to identify well-priced stocks and those with favorable prospects. Equity analysts will also use fundamental analysis to generate price targets and recommendations to clients (e.g., buy, hold, or sell). Corporate managers and financial accountants will also use financial analysis to analyze and increase a firm's operating efficiency and profitability and to compare the firm against the competition. Warren Buffett, one of the world's most renowned value investors, is a promoter of fundamental analysis.
$SGX(S68.SG$ $Dow Jones Industrial Average(.DJI.US$ $SPDR S&P 500 ETF(SPY.US$ $Hang Seng Index(800000.HK$ $TENCENT(00700.HK$ $IDREAMSKY(01119.HK$ $WUXI BIO(02269.HK$ $BIDU-SW(09888.HK$ $XIAOMI-W(01810.HK$ $XPENG-W(09868.HK$ $BYD COMPANY(01211.HK$
Broadly speaking, fundamental analysis evaluates individual companies by looking at the firm's financial statements and examining various ratios and other metrics. This is used to estimate a company's intrinsic value based on its revenues, profit, costs, capital structure, cash flows, and so forth. Company metrics can then be compared with industry peers and competitors. Finally, these can be compared to the broader market or larger economic environment.
Who uses fundamental analysis?
Fundamental analysis is used largely by long-term or value investors to identify well-priced stocks and those with favorable prospects. Equity analysts will also use fundamental analysis to generate price targets and recommendations to clients (e.g., buy, hold, or sell). Corporate managers and financial accountants will also use financial analysis to analyze and increase a firm's operating efficiency and profitability and to compare the firm against the competition. Warren Buffett, one of the world's most renowned value investors, is a promoter of fundamental analysis.
$SGX(S68.SG$ $Dow Jones Industrial Average(.DJI.US$ $SPDR S&P 500 ETF(SPY.US$ $Hang Seng Index(800000.HK$ $TENCENT(00700.HK$ $IDREAMSKY(01119.HK$ $WUXI BIO(02269.HK$ $BIDU-SW(09888.HK$ $XIAOMI-W(01810.HK$ $XPENG-W(09868.HK$ $BYD COMPANY(01211.HK$
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patricklowck123 : can Baidu rise?
DTG2191 : Can DiDi revive from the price plunge?
GM 1 : Sounds like God of the Stock Mkt - that why people are asking for predictions too :))
Ally-LinOP patricklowck123: Yes
Ally-LinOP DTG2191: Pending the outcome of the investigation
eitokun : Is XYF gone case since it fell through 20 MA (10.50) ? I bought at 12.50.
Ally-LinOP eitokun: I don't care much about the technical side, just the reference