Fundamental Analysis For Dummies

Pick stocks, create a portfolio, and build a nest egg

Ever wonder how the pros pick the stocks they invest in? Well, most of them use some form of fundamental analysis, a popular method for assessing securities. In Fundamental Analysis For Dummies, you'll get a crash course in valuating publicly traded companies based on their financial statements, overall health, competitors, markets, and the overall economy. You'll also get easy-to-follow advice on how to protect your investments and diversify your portfolio so you can reduce risk without sacrificing returns.

Inside...

• Learn fundamental analysis basics
• Discover why fundamental analysis works
• Get your hands on important data
• Perform a fundamental analysis
• Understand financial statements
• Construct financial ratios
• Read proxy statements
• Valuate and price stocks

Matt Krantz is a nationally recognized financial journalist who specializes in investment topics and personal finance. He’s the management editor for Investor’s Business Daily, and his work has appeared in USA Today and Money magazine.

Introduction 1

Part 1: Getting Started with Fundamental Analysis 5

Chapter 1: Understanding Fundamental Analysis 7

Chapter 2: Getting Up to Speed with Fundamental Analysis 19

Chapter 3: Gaining an Upper Hand on Wall Street: Why Fundamental Analysis Gives Investors an Edge 37

Chapter 4: Getting Your Hands on Fundamental Data 55

Part 2: Performing Fundamental Analysis Yourself 75

Chapter 5: Analyzing a Company’s Profitability Using the Income Statement 77

Chapter 6: Measuring a Company’s Staying Power with the Balance Sheet 97

Chapter 7: Tracking Cash with the Statement of Cash Flow 115

Chapter 8: Using Financial Ratios to Pinpoint Investments 133

Chapter 9: Mining the Proxy Statement for Investment Clues 155

Part 3: Making Money with Fundamental Analysis 173

Chapter 10: Looking for Fundamental Reasons to Buy or Sell 175

Chapter 11: Finding a Right Price for a Stock Using Discounted Cash Flow 197

Chapter 12: Using the Annual Report (10-K) to See What a Company Is Worth 215

Chapter 13: Analyzing a Company’s Public Comments and Statements 237

Chapter 14: Gleaning from the Fundamental Analysis Done by Others 249

Chapter 15: Performing “Top-Down” Fundamental Analysis 267

Part 4: Getting Advanced with Fundamental Analysis 279

Chapter 16: Digging into an Industry’s Fundamentals 281

Chapter 17: Pinpointing Trends Using Fundamental Analysis 297

Chapter 18: Avoiding Investment Blowups with Fundamental Analysis 313

Chapter 19: Marrying Fundamental Analysis with Technical Analysis 329

Part 5: The Part of Tens 349

Chapter 20: Ten Things to Look at When Analyzing a Company 351

Chapter 21: Ten Things Fundamental Analysis Cannot Do 359

Index 369

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