What you have learnt
Fundamental Analysis is all about the ‘real’ value of the stock. There are several tools and ratios to measure. You learnt so far:
- Earning per share: what are the earnings of the company per share?
- Price-earnings: relates the earning of the company with the price of the stock
- Dividend percentage: what is the dividend as a percentage of the share price?
- The outcome of the calculations itself is interesting, but to really use Fundamental Analysis you need to compare the information with companies in the same sector, compare sectors with other sectors, compare the information with historical ratios of the company etc.
- Click here to consult the dictionary.