Fire Your Stock Analyst!: Analyzing Stocks on Your Own

Summary

Few would argue that evaluating a firm’s financial health should be done for every investment candidate. You’d think that market analysts would take that step before advising investors to buy a stock, but since they don’t, you have to do it on your own.

You can simplify the task by sticking with low-debt firms showing positive cash flow and positive working capital. You can get a quick read on high-debt firm’s financial health by checking their bond ratings and their bond risk premiums, but the Detailed Fiscal Fitness Exam is the best way to determine a potential financial basket case.

Fiscal Fitness Exam Worksheet COMPANY __________________________ as of (financial statement date):__________ Income Statement a) Sales Growth: TTM Sales ...