What Does Negative Shareholders Equity Mean On Balance Sheet

Recently I was reviewing a list of stocks from the BSE-500 index. I found some stocks showing negative shareholders’ equity. I wondered, what caused the negativity? The companies I’m talking about are these: None of the above companies are financially healthy. To cross verify, I checked their overall scores in my stock analysis worksheet. These […]

Cash Flow Ratios: To Analyze Cash Sufficiency of Companies

We already have multiple financial ratios emanating from the balance sheet and profit and loss accounts. Why do we need to add cash flow ratios to the list? Profit and profitability are a measure of the company’s ability to yield cash. Cash is king. No matter how big the quantum of profit and profitability is, […]

Stock Selection Criteria – Fundamental Analysis For Beginners [A Guide]

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Value investors estimate the intrinsic value of stocks more accurately. But there are more than 5000 listed stocks in the market. Even the experts cannot go about calculating the intrinsic value of all stocks. What do they do? They apply stock selection criteria, to shortlist potential stocks. [Note: I got the inspiration for this article […]

About Small-Cap Stocks: An Investment Guide

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Not everybody likes investing in small-cap stocks. Why? A general feeling about small-cap stocks is that they tend to default on their creditors and investors. But it is an excessive generalization of the fact. Though it is also true that it is more likely to find badly managed companies among the group of small-cap stocks. […]

Financial Health Of A Company: How To Identify A Company With Healthy Finances?

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Talking about stocks, investing only in a financially healthy company is advisable. But it is easier said than done. Why? Because analyzing the financial health of a company is not easy for a novice? It is a thing that must be learned. In this article, we will try to do just that. Generally speaking, investors […]

Understanding A Company: Why It Is Essential For Stock Investors?

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Understanding a company is essential before buying its stocks. Why? Because Stocks represent proportional ownership in a company. So, what is the utility of this information about stocks/business? Let’s understand this with an example. Consider yourself looking at two companies, Nestle India and Jet Airways. Former represents a healthy business, while the latter is languishing with […]

Intrinsic Value: The Concept of True/Fair Value of Business

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What is the intrinsic value? It is the inherent value of an asset (business, enterprise, etc.). The essential nature of the asset gives it its intrinsic value. The value is not dependent on external circumstances. We can also understand intrinsic value as a true value of an asset. From an investment point of view, it […]

Reliance Future-Group Deal: Where The Deal Leaves Future Enterprises Ltd?

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[Note: Subsequent to the Reliance Future-Group deal, the company has been in a legal battle with Amazon. This legal controversy has severely hampered the long-term prospects of Future Group. The below article was written before Amazon intervened and changed the whole scenario.] Reliance retail and future group company entered into a deal on 29 August […]

Financial Statements: Understanding Cash Flow Statement of a Company

Out of balance sheet, profit & loss a/c and cash flow report, perhaps cash flow statement is the easiest report to read and comprehend. But in terms of effectiveness to judge fundamental strength of a company, this report is as valuable as the other two. Cash is king for a company. If cash is flowing […]

Stock Comparison Tool: Use it to compare Five Stock at a time [Excel]

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The stock comparison tool was one of the first tools which I developed in excel. In the last few days, we have made it more online savvy. Now, this tool can fetch stock data automatically upon click of a button. Check Our Big Screener – A WebApp The worksheet also has few limitations. It works […]

Introduction To Fundamental Analysis of Stocks (Business)

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What we do when we say that we are doing fundamental analysis of stocks We actually study the underlying business of that stock. To understand the need of fundamental analysis of business, let’s take a small example. Suppose you want to eat a chocolate, what you will do? You will go to the market and […]

Investment versus Speculation : How Intelligent Investors Deal with it?

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This debate between investment versus speculation is never ending. But I would like to present a case here from my perspective. So first thing first? Why we invest money? We invest money to build wealth. But by speculating with our money (instead of investing) we are not building wealth. Buying low and selling high concept […]