Investing ideas: https://www.overlookedalpha.com
Some of you have asked where I get the data for my financial analysis.
So here’s a quick run through of my process.
It’s a good idea to get data from the source. So when I analyze a company I usually type the company name into google followed by Investor Relations.
That takes you to the company’s investor relations page which holds all the press releases, quarterly and annual reports.
Next I’ll look at the latest press release. This usually provides the important highlights, guidance and numbers.
If I need more information, I’ll move on to the financial statements themselves. These are the same ones that get sent to the SEC.
The first thing I do is to find the total number of shares issued and outstanding. It’s often at the beginning of the PDF or on the balance sheet. I multiply this figure by the current share price to get the market cap of the company.
Next, I look at the balance sheet to work out the enterprise value. I take the market cap I already calculated then subtract cash and short-term investments from the balance sheet and then add on long-term debt to get the enterprise value.
It can be more complicated than this, but generally, this is the amount you would have to pay if you wanted to buy the business outright.
Once I know the enterprise value I’ll look at the income statement to get revenue over the last 12 months. Often, companies will only report the last 9 months, so in that case I’ll take the 9-month figure and then I’ll go back and look at the revenue from four quarters ago, in a separate filing, add it on and that will give us the total for the whole 12 months.
I’ll do the exact same thing for net income, earnings per share, EBITDA and Free Cash Flow.
Companies report different numbers so you may not always be able to see free cash flow or EBITDA, in which case you can work it out for yourself if necessary.
But usually, the numbers the company provides are enough to do your analysis. And its also good to record the company’s guidance.
So once I have those numbers I then compare them to the enterprise value to work out the price to sales or price to earnings multiple.
#stocks #investing #companyanalysis #fundamentalanalysis #overlookedalpha
Some of you have asked where I get the data for my financial analysis.
So here’s a quick run through of my process.
It’s a good idea to get data from the source. So when I analyze a company I usually type the company name into google followed by Investor Relations.
That takes you to the company’s investor relations page which holds all the press releases, quarterly and annual reports.
Next I’ll look at the latest press release. This usually provides the important highlights, guidance and numbers.
If I need more information, I’ll move on to the financial statements themselves. These are the same ones that get sent to the SEC.
The first thing I do is to find the total number of shares issued and outstanding. It’s often at the beginning of the PDF or on the balance sheet. I multiply this figure by the current share price to get the market cap of the company.
Next, I look at the balance sheet to work out the enterprise value. I take the market cap I already calculated then subtract cash and short-term investments from the balance sheet and then add on long-term debt to get the enterprise value.
It can be more complicated than this, but generally, this is the amount you would have to pay if you wanted to buy the business outright.
Once I know the enterprise value I’ll look at the income statement to get revenue over the last 12 months. Often, companies will only report the last 9 months, so in that case I’ll take the 9-month figure and then I’ll go back and look at the revenue from four quarters ago, in a separate filing, add it on and that will give us the total for the whole 12 months.
I’ll do the exact same thing for net income, earnings per share, EBITDA and Free Cash Flow.
Companies report different numbers so you may not always be able to see free cash flow or EBITDA, in which case you can work it out for yourself if necessary.
But usually, the numbers the company provides are enough to do your analysis. And its also good to record the company’s guidance.
So once I have those numbers I then compare them to the enterprise value to work out the price to sales or price to earnings multiple.
#stocks #investing #companyanalysis #fundamentalanalysis #overlookedalpha
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NewsTranscript
00:00 Some of you have asked where I get the data for my financial analysis, so here's a quick
00:04 run through of my process. It's a good idea to get data from the source. So when I analyse
00:08 a company I usually type the company name into Google followed by investor relations.
00:13 That takes you to the company's investor relations page which holds all the press releases,
00:17 quarterly and annual reports. I'll look at the latest press release, this usually provides
00:21 the most important highlights, guidance and numbers. If I need more information I'll
00:26 move on to the financial statements themselves. The first thing I do is to find the total
00:30 number of shares issued and outstanding. I multiply this figure by the current share
00:34 price to get the market cap of the company. Next I look at the balance sheet to work out
00:38 the enterprise value. I take the market cap that I already calculated, then I subtract
00:43 cash and short term investments shown on the balance sheet and then add on long term debt
00:47 to get the enterprise value. Once I know the enterprise value I'll look at the income
00:51 statement to get revenue over the last 12 months. I'll do the exact same thing for net
00:55 income, earnings per share, EBITDA, free cash flow etc.