Fundamental Analysis

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Adapt investing strategies using the same disciplined analysis that has made Warren Buffett successful. "Mastering Fundamental Analysis" performs the valuable service of leading everyday investors into better investment decisions, while allowing them to learn at their own pace through the use of worksheets, graphs, sidebars, and step-by-step examples. Michael Thomsett is one of the best authors at explaining the stock market that we've read.

Fundamental Analysis is the art of analyzing a company based on its financial position, which is the foundation which all companies are built upon. It includes review various financial statements, companies revenues and cash positions.  This contrasts with technical analysis which looks at the past price movement of the stock to determine what the future movement of the stock will be.

First determine what business the company is in. The best place to check is Hoovers online.  Look for companies which have better revenues and earnings than their competitors.  Check out FreeEdgar.com for the companies annual report (10K).  Revenue or sales is a good way to judge a company.  View your stock fundamentals at MoneyCentral.

Links

• The Street.com article on Fundamental Analysis
• Return on Investment
• Fundamental Data
• Reading an Annual Report
• About.com

Books to Purchase here

• Mastering Fundamental Analysis by Michael Thomsett
• Online Investing by John Markmen.  Chapter 8 has one of the best easy-to-understand sections on fundamental analysis
• Fundamental Analysis by John C. Ritchie, Jr.