Table Of ContentMastering
Fundamental
Analysis
MicgHaeL G. THomseTT
EM Dearborn
Financial Publishing, Inc?
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CONTENTS
Profice Whos This Rook Wilt De for Tow
Insvoducion The Big Sect ks, Thove Bs No Big Seow:
Desinng the Funan lata Ya Noe
‘Tieng 0 Finacial Iatonnicon-—vererday's News
‘Tae Relish item —Aceuracy ofthe Neen
Finvelal Rating. Hos Thoy Boe
Heri Whe They Ae Tiny ok
rele Secret Wes
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S. Viskicy Apstthe Kgancale asi That ea Think
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Petigg Micke Services to ot,
How co Beaty Bo the Stock Listings
{What Makosi Presa Caan
Fewemi fdas co Gragg te concn
Diag Bune ovatng cr The Mea athe Catan
Founder Sparaia Meaas
‘edible fetigues ee See cesta
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PREFACE
What This Book Will Do far You
AS at inestor, you want ane need basiv information te seer a
coaaysry whose sks wil tee! your investant gous, Yau need Use
Iondamentls—inferstien bout x copes thot tee you aout
Financ consistency wud reliability, profi. dividends. property und
een oe other dotlars-amt-cen nforraatinn,
Site, ssighitorserd‘nioviation an practi Sia i te
cer ind, Whom gow hegin rsaing reports prepurd By sevens,
land nals yon eam lose your aca, nkose yom ane facial
"exper Youuselt. If yon depen on bucks Fa infociatoo a ecah
ina copy’ Suidomnentls, you Hid thal basi inforasivn is wel
Jy dificult wo ovate—uil no
this book is erie for fnvesters, not Cor Hnanciel expets. if you,
swim lo ieptuse your nell al fundamental anslnis, ts 0k = Lor
ym Leads you row rehing and analying fan anal finan
fal infommatian in az 5 pafit, spy aad demaydl inchs
strong, managuancne abi, su oboe Lisle allesting # susKes
‘eauket vate and gioth pore
‘Fe ths exter Moat quath is evessy abe pat this bau. me
wil] explain the proces step by sep. provi excampes. sad wath ou
rough Ide explanutva, Ys sul ame need inden. matical udvice
Lenten your nnetment nee, atl this honk wll acres shal nee,
{We void swoek marked lay inormmison ia el hy nasa
iste wha apes rose ve i echnies ems anid wert
Ststial rsa ing to sorananieare wth ane anesthe
This hook, verier Fa tbe nonaccounta he wats brake incest
neat iaFoutien, teaches you to Muster be esses of Hacc
tangas, These include sudyiag, fisesial stalecrena, unespreting
Trend, using ratios, and musing nforined decision asd agile
taleraion. Uns vs possible witb hang lle couse i hehe
level sscounong or Seumtiea! analyess. Coraidy, tore as ¢ ned fot
viii ase. Wha Tie Book Wl Oe Fn ou
‘eanical eommmaicaton aunwag facial pralesivnals, essere tk
loot ant alee sewr aeeds us a iavesloe, Tk gp in eke infer
Hon veeus invariably in communication, between experts whi have the
infuration apd nouespers wlio need te iformaaion.
“This basic, pactcal guide uses u sees of tots ts help bree dows
ecm does at eomespla so Unt sou can make practical uke of the
{nirmation, "these wos elude
worksheets an forma seu cam nse ta samp information sbaut
‘eempames and compare i
4 raphe and ear to expect the ideas hehind columtas and set
BF mounbote in a sey that makes stuse To bel visualize sells;
+ checitns of wetvn ews au points worth remecbeding
+ escrmptee iat laf aad Mesa impuntan poi
+ deiniuons phived in women! ay Ut adeus vim soross clear, 8
you can vero jrgn ued by “ochre exper
+ key points et aside ard bighlighod for ease of cenit: and
+ cealbrheaegi 19 help wth procceee such 36 mathematical
fiom
CCallestival, these tools ll help fou teach yourself the ssscatal
acs uf fuuanaesal sankysis, Ine avoid “ke vouplexiies ule ase
vate wid Gnstie. We all end esish ee auformbou, even whe
swe aoed il, This book sill help you osevorae the remlaate scl
achiewe a mastery of the valuble ols yeu need to make informed
decisions,
Narking inthe sy af financial information i 30 complex that
amis gesped fy the avessge inwsor, Na ple isso technical tat
‘yon eannat fallen tha cance, and hte age na ens cot axe avaiable
fly tothe eahnican. Those ess and eoucepts wil be explained sia
land thouonghly 36 sou si ame use of hen,
“ INTRODUCTION
The Big Secret Is ... There Is Nu Big Secret
Val the wn seure the higgest soem a Wall Smet —and ot
any specalied musty. Wey itl in thetimuncel world ee eames
thae Sau carnor grasp it Ths fundamentels age a3 thsic mame
imoliss—toedamommal, basic, anenmpliatsd, The only factor sump
‘ating Finaacal informacion: ago, oscil coupler silica way
Sis, aad comple formulas that don't convey iafucraativn aay beuee
ssa anh ak
Tor instance, he eeseutial purpose of preparing ficial report
sp elurify und cormmanicals fnformation. ‘The basit af furdarzental
swalyss is accountng, znd secounting links mors than eh ropercing
se tranetcrans: where money smd obligations gan Frou aad where
“ey go. The hestaeccating systems ae clear end simple, 20 a5
ao the money. Agcouncing aso ie designed ro help awaiyts spot
els and Loneeast Hikes ouleuines bused on those tends. This book,
leals msialy with the Use primery purposes of nancial reprcine:
simplicity m internet the nomers, an analyse hosed om those
nurches
‘Win the vas. amount of formation avila throwgh, publication of
sineneial ssremomes, analyser” repr, the Timm! press. and the
Income, a Taege pat of 7 intorperion-gatheving ask is already por
“cmd He yon. The dict thug for sou as a vest is tu dete
‘sic. dnformadon fo se. Not all of e vas artay of avaiable data is
felisble.telesoot, oc especially useful i waking the devisow #9 bus,
Soll, or sll u mice stock,
This beuk, Cit uf al, assures that al of the ination investors
need ve eealily wv tat i¢ cum he undertod sarpetety i its
amined ime explained peeperty, sl dua the real challenge fer the
invowtor in bridging che ep hetscen fining intermaian and mpl
ng tp it ths decision-making aracese. To adegres, ancy all
unalog the Fag Sere Is The Is Ii Sera
performed for you ag services tke Valno Line and Standaed
Pont’, nor r+ meat Ibe ina abalysis going cm onetenty in
the Fmyicial press, Second, ts book is carstlly designed ro peescnt
information ina bighlysistal maanec, This inelrdes Ce amphesis at
Leg pings Yor ease of mleienve; geuerurs use cl explo, obats,
oct. ia works Heels; penly of exannplerock-ltuoughs Lor usa
cermatival procedures: und definitions provided when aterm or phrase
is fis. inanduced, “These ols ane lechniquer che Canduri
anclyois pratt fend relly aaah yin
Unlike many investmme prozrims tha propicss 1 xpuanteausthou,
we cn mie sagese that exe'yone. sill he comfortable oth cme
appreach. This hoa cxpleas has cach rye o° fundamental interna
Uist pas arnt a it sows iis hil you to ids whi cechnigne
sbuthl be elven te greatest weighr. oF which should cvou be ased xt
all The basic assumption is Ua, as am indiidual, each inestos wes
tw el cp progr: for sina cola ad ese
“Tose sore Uh the tests yu dei appl inormsivn ae wid
and meaningful, thix ok augeeste possthle way te approx the
anadysis a sek. potion industry or poatieularlrvtegy. The
Inetinn is give gn the ‘ntormatin wo deeie hows t passed. aed
‘a your potsonel scaly, sk elerance, macket atime and pilose
buy, aad persualil, This uk aero ab auagie Loam, antl? aoe
show you ue get ih quick” aoe uncut alysis 23
sow au bow ts "go infer quick!y” in the belie tha having poo
Snfriaon less god devivon raking, and hat decision cake
sre round Uneug s05sess and pits
CHAPTER 1
Defining the Fundamentals—
What You Need
Mes iswestrs aegona on financial information m9 jntge came
hes. And by nor? Dallas ve how Imsivess keeps scone, judges s0e-
ess forests the litre, aud determines who i outpeconaing the
competition. Taaderuental ralyis is the raethad chive because i
Tinie dependale, comsister tarmtton
‘wha un sou expect trom fundemental ust ant why pein
analysis a at? Those questions axe gor suuming points fseatse hey
stablich the very rousnme to andsrake analysis, Fundamental ts
cee than sagthig scancaus Jog sounpasioa, WE aM MS
hudgens vale LF comijaving oue Diag le auellee, We duu’ huge
shat our peeferences are unl ¥e Jock at to oe nove aleatives. This
isa true ine stock mike iis everywhere else, Fundamental tess
area consisent application of standurés io several omipanies, We bape
the rele af those Lents wb gunds us im aor deenions to soll une
‘Stoo ewer enothe:; end then i bay, hold, oF sll
ur why peririn alysis all? Why noe simply chase wooks hy
Jang rts arcs sek lssings? Som people make an argument
3a mndom celecion of stocks ig 9 afectve 4 method ae any kor.
‘The somone wv shew Fo esaumple, says stork peicas bane in 8
sunt and bapfelicisle muse, sed Oat the elf. 9 abr ions
som ut tke pS Ta be predate wil uy dere of eval
Anyone wao reriusly appriuches auvesting ha 4 ues he
vig of the random wale their. Tt just make sens that sade
2 Maieing andamensal Anassis
Insaco, nic ifouaton stout a compiny leas tt nelle
yt sac selcta se Us Ele ws pain reser h oy esl in
Bd caine low of uae, Me euple are a dig
beer dam ay doy ese
‘sect agar concn he macho th fea rar ery,
vic sat thas the eure ples ob ele ote ncn ne
tnaion ab the spare heoy alin ate faa nw na
Ho ces re cng eae pice in ry
“Tee theory times Une see TO pen Me maT a 8
eps mak of infocmaton and nigel sso les Es
‘stnaon cma an rei yt pepe has Unt th ok,
fnedkel Has a dive of sacs wi. and Ut such efieney atspor
‘esl
“Een ikey eats sae lnfnmaton are scot Uh
ceva the intoraten, uc nla am uke ces ne rice
teeponaiy ewereue prety aetng the ps
Uh easy 0 theore abok mike ores, sly ana demand an
thc peyehnngen cans fhe pend inert whoa “aly
Soong Reo he antet wees. Such ss aor of ees 818
sce pie oat eis bow ke Dace hs gH e te
ier Kio lo ick sucks, Becuise pies car, fu wilt
obvious vane an elec degree of exitment sumvamds stock ma
tel imesing, Thal extent make easy all no be tees
that re os Tn em, a
inaret pies ek fl a ene va ath he 9
thn any no aga r randmearyResed forme,
Defining Fundamental Analysis
Fundamental antysis 6 a met of voserey thas audios bse
Fiaanena. ifinnasinn to foreest profit, apply and desrand, incantry
"arongth, management air, and athsr intins mares atsoting @
saeek’s markct wan aad grcath goteatial, Tho .eseltiug doe ation
sm bolp you msiowsin gerspecdve. Covsinly saa aspecys, of pre
Inewemest inthe soe wire sr heya ogi, sa allie to voue
with 9 Iggiva: vind, The lnnameatal— those inte facts aboot a
wompuay ca Be used ty Toevi,finnsial performace and, te sume
3egtes. stuck price movements, More invetnns ese fundamental ban
ather wth, Nenfundarzenaii mthous ane urlletvely kine
Whose tvag A
ENfiing ne uct
secu ins, The Ustiaiot ceuical analyst Gur “extn
shrasTindienr, often on te PAU Gn snl sporty Is
lubiely Dott, yer gaps old imation. aud by te very anne,
‘fag us, Avoodingy, sh iforaacin is een 1a ih howe 8
Sox} eae! price will use tolaoc oe De est hy
“oth fardarsenal al tenia aulsis ues en, but de,
seaps Te funda aponch ena Mua inormaliveteisi
dene nes, ls len. Coe Mp) Treen Rapa ests
“eetaien ute ends Tetaial nays is Mighell lnely
ignvor the hae poms of eappy ani mands hein ste th
sNentt price conde (rumen ve chins dette furs pees suosems
ssc he eating Doe 8th ea of spp teat ete
dunce foe, Thess Ives a6 dev tou 3 study ata socks eer
Prive changes. hea ds price nes Neots ae eel hee
Ecvenpoted pri) ur ave i esac eel
rice). thot i called bale atic a poe i
tuhlhed range. Che concep of suppoet and resistive vel 003
Tsk ire nirnaiced i Fy C
even Inne whi son by Uke Tomes nhould reese Ut
technical annie serves waefal porpn. Hut tev the mos [lh
Tel ot goiner ertneere can ignore ha widasperad et Fade
reall indictor hat an mors baths? pees fr ahewe oF Felow
HIGURE TA Toning Range
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