Chapter 9

Analysing Stock-Market-Quoted Companies

In This Chapter

arrow Understanding what company profits are all about

arrow Getting familiar with the price/earnings ratio

arrow Understanding that dividend declaration you get from the company

arrow Deciding whether you can trust forecasts

arrow Working through company takeovers

arrow Deciphering share price charts

Being a successful share investor involves looking at numbers and understanding them. But don’t worry. You don’t need a PhD in mathematics or rocket-science physics. Much of the figure work involves nothing more complicated than looking to see whether something is going up or down. And most of the rest involves the simple task of comparing figures from one company with those from another.

The most difficult maths task is working out percentage sums, which you can do on a calculator costing a fiver or so – and you’ve probably got one on your phone for free. ...

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