The first three analysis tools dealt with abstract numbers such as earnings forecasts and P/E ratios and the like without regard to the company’s business. Given the same numbers, your conclusions would have been identical whether you were analyzing a maker of chewing gum, buggy whips, solar cells, or wireless communication chips.
Now it’s time to learn about your candidate’s business, industry, and competition.
First, find out what the company does for a living. What products and/or services does it sell? That’s a no-brainer if you’re talking about Wal-Mart, but how many investors know what products or services F5 Networks or Zimmer Holdings offer?
For a concise overview, Morningstar’s Snapshot ...