Evaluating Company profitability can be complex. It is especially true when we are comparing different-sized companies. In this article I’ll give you a peep inside the algorithm of my Stock Engine. The article will introduce you to a refined scoring system that considers average profitability, consistency, and company size. By normalizing and weighting key factors,…
Deciphering the factors that influence company valuations is crucial for investors. Two key metrics that play a pivotal role in valuations are profitability and growth rate. We’ll understand how profitability and growth collectively affect the valuations of companies. We’ll use examples to get a hold of this correlation. Effect of Profitability (Example #1) Suppose there…
To assess a company’s profitability requires a nuanced understanding of financial metrics. This article is about how to measure the profitability of companies. We will learn how to tell if a company is profitable by reading its balance sheet and profit and loss accounts. Which ratios can measure and highlight the profitability aspect of the…
In this article, we’ll see an approach to identify the best sectors to invest in the Indian stock market. The good sectors are the ones that are intrinsically profitable. So, this analysis is totally based on the concept of profitability. The best sectors will be the ones that are most profitable. The Top Sectors List…
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…
The cost of capital is the cost that a company must bear for the funds it has raised to do the business. Doing business calls for arranging cashflows both for short and long terms. There are two ways companies can raise money. The first is through equity. This is done by the distribution of ownership among…
