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Fire Your Stock Analyst!: Analyzing Stocks on Your Own

Book Description

This is simply the world's most useful book for personal investors who want to rely less on the so-called "experts" and more on their own  intelligence and knowledge. The author presents systematic value and growth strategies that draw on the best ideas from more than 20 of the world's leading money managers -- and shows you how to implement each strategy step-by-step, using free or low-cost information available on  the Internet.  Domash introduces never-before-published advanced analysis strategies, shows how value investors really pick stocks, and presents new ways of quantifying a stock's risk. This book covers issues most books simply ignore, including how to evaluate a company's business plan and true financial strength, how to set your own target prices, and most important, when to sell .

Table of Contents

  1. Copyright
  2. Financial Times Prentice Hall
  3. Financial Times Prentice Hall Books
  4. Figure Credits
  5. Introduction
  6. Acknowledgments
  7. Getting Started
    1. The Analysis Process
      1. Finding Candidates
      2. Analyzing Stocks
      3. Quick Prequalify
      4. Detailed Analysis
      5. When to Sell
      6. Summary
    2. Evaluating Risk
      1. Market Valuation
      2. Market Direction
      3. Spotting Strong Industries in a Weak Market
      4. Company-Specific Risks
      5. Company-Specific Risks Described in Subsequent Chapters
      6. Summary
    3. Screening
      1. Sample Growth Screen
      2. Value Screen
      3. “MSN Money” Down & Out Value Stock Finder
      4. Reuters Investor Bulletproof Stocks
      5. The Zen of Screening
      6. Premade Screens
      7. Summary
  8. Analysis Tools
    1. Analysis Tool #1: Analyzing Analysts’ Data
      1. Who Are the Analysts?
      2. Analysts’ Ratings
      3. “Sell” Is a Four-Letter Word
      4. Consensus Ratings
      5. Do Strong Buys Outperform Sells?
      6. Number of Analysts
      7. Sentiment Index
      8. Analysts’ Estimates
      9. Forecast EPS Trend
      10. Earnings Surprise
      11. Sales Forecasts
      12. Regulation FD
      13. Research Reports
      14. Summary
    2. Analysis Tool #2: Valuation
      1. Implied Growth
      2. Growth at a Reasonable Price
      3. Dividends
      4. Summary
    3. Analysis Tool #3: Establishing Target Prices
      1. The Process
      2. Cisco Systems
      3. Summary
    4. Analysis Tool #4: Industry Analysis
      1. The Business
      2. Industry Growth Outlook
      3. Industry Concentration
      4. Picking Winners in an Emerging Fragmented Industry
      5. Industry Scuttlebutt
      6. Summary
    5. Analysis Tool #5: Business Plan Analysis
      1. Introduction
      2. Overblown Competitive Advantages
      3. Business Plan Score Scorecard
      4. Summary
    6. Analysis Tool # 6: Management Quality
      1. Key Executive and Board Quality
      2. Clean Accounting
      3. Earnings Growth Stability
      4. Stock Ownership
      5. Summary
    7. Analysis Tool #7: Financial Fitness Evaluator
      1. Financial Fitness Counts
      2. Pinpointing Financially Challenged Companies
      3. Simplify the Problem
      4. Low Debt
      5. Detecting Potential Busted Cash Burners
      6. Detailed Fiscal Fitness Exam
      7. Bond Ratings
      8. Use Bond Risk Premiums to Identify Risky Debtors
      9. Summary
    8. Analysis Tool #8: Profitability Analysis
      1. Where Do Earnings Come From?
      2. Analyzing Sales (Revenue) History
      3. Analyzing Margins
      4. Gross Margin
      5. Operating Margin
      6. Net Profit Margin
      7. Comparing Margins
      8. Gross Margins
      9. Operating Margins
      10. Analyzing Margins
      11. High vs. Low Margins
      12. Analyzing Overhead Expenses
      13. Profitability Ratios
      14. Marginal Return on Assets
      15. Cash Flow Analysis
      16. EBITDA vs. Operating Cash Flow
      17. Free EBITDA
      18. Summary
    9. Analysis Tool #9: Detecting Red Flags
      1. Sales Growth Trends
      2. Accounts Receivables & Inventories
      3. Statement of Cash Flows
      4. Pension Plan Income
      5. Yellow Flags
      6. Summary
    10. Step 10: Ownership Considerations
      1. Institutional Ownership
      2. Insider Ownership
      3. Summary
    11. Tool # 11: Price Charts
      1. Trends
      2. Moving Averages
      3. Avoid Downtrends
      4. The Risk Zone
      5. Chart Types
      6. Trading Volume
      7. Summary
  9. The Analysis Process
    1. Quick Prequalify
      1. Profile & Snapshot Report
      2. Valuation Ratios
      3. Financial Highlights Report
      4. Ratio Comparison
      5. Check the Buzz
      6. Summary
    2. Value Investing: The Process
      1. Cycles
      2. Normalizing
      3. Value Analysis Process
      4. Step 1: Analysts’ Ratings & Forecasts
      5. Step 2: Valuation
      6. Step 3: Target Price Ranges
      7. Step 4: Industry Analysis
      8. Step 5: Business Plan Analysis
      9. Step 6: Management Quality
      10. Step 7: Financial Health
      11. Step 8: Profitability Analysis
      12. Step 9: Red Flags
      13. Step 10: Ownership
      14. Step 11: Charts
      15. When to Sell
      16. Summary
    3. Growth Investing: The Process
      1. Growth Candidates
      2. The Process
      3. Step 1: Analysts’ Ratings & Forecasts
      4. Step 2: Valuation
      5. Step 3: Target Prices
      6. Step 4: Industry Analysis
      7. Step 5: Business Plan Analysis
      8. Step 6: Management Quality
      9. Step 7: Financial Health
      10. Step 8: Profitability
      11. Step 9: Red Flags
      12. Step 10: Ownership
      13. Step 11: Price Chart
      14. When to Sell
      15. Summary
  10. More Tools
    1. Earnings Reports & Conference Calls
      1. Reported Earnings
      2. Summary
    2. Detecting Scams, Frauds, and Pump & Dump
      1. Opportunity Knocks
      2. Shoestring Operation
      3. Hyping Pays Well
      4. Quick Hype Checks
      5. Summary
    3. How to Read Financial Statements
      1. Income Statement
      2. Balance Sheet
      3. Statement of Cash Flows
      4. Finding the Data
      5. Pro Forma Accounting vs. GAAP
    4. Analysis Scorecards
      1. Value Stock Analysis Scorecard
      2. Summary
      3. Growth Stock Analysis Scorecard
      4. Summary
    5. Glossary
  11. Index