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I contribute some interesting financial terms(you can google them to find out more) which you will see in analayst reports using this, news or when doing your own analysis etc.
1) Overweight
2) Underweight
3) Outperform
4) Underperform
5) EPS - rolling EPS, diluted EPS, annualized EPS growth
6) NTA (non-tangible assets such as goodwills, patents, trademarks)
7) Current ratio
8) ROE (return on equity)
9) ROA (return on assets)
10) Dupont analysis (breaking down ROE into 3 parts for specific studies into how the ROE is being generated. Normally, investors may have the idea of seeing double digit ROE = positive when what they put into the company and get better returns. The ROE has to be subclassified into 3 parts. For example, through doing this, you can know which part constitute mostly to the ROE figures.
11) Margin of safety (I love Benjamin Graham hahaha...)
12) Gross margin, net margin, operating margin
13) Asset turnover
14) RNAV (revised net asset value)
15) Rule of 72
*There are much more terms out there when you refer to the financial statements.
Other market based valuation:
1)Price to earnings ratio (PER, P/E) ----> take note: it does NOT mean that P/E is decreasing over the years = cheap price to go in. You have to compare whats the common industry P/E (get from your brokers) or your peer P/E in the industry, Try to get an av. industry-consenus P/E on how much the security is trading to its price value.
2) Price to book ratio (P/B)
3) Price to earnings growth ratio (PEG) ---> can be used when NAV may not suitable to value some businesses
4) Price to sales/revenue (P/S) ---> seldom used
5) Price to cash flow (P/CF)
6) Price to book value (P/B) ---> when you use NAV to value an equity
7) EBITDA (earnings before interest, taxation, depreciation & amortisation) ----> used mostly for properties. honestly, some companies use this during window dreassing as it looks "nice".
If I got time the next time round, I will put some insights on how you analyse a financial statement - income, b/s, cfs, and looking at interesting points in the annual reports. we can then share our knowledge on it.
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PM AsianBookie
09-Oct 2008 Thursday
11:48 AM (5900 days ago)
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09-Oct 2008 Thursday
11:51 AM (5900 days ago)
