Fundamental analysis of stocks is a method of evaluating a company’s financial health and performance, based on its financial statements and other publicly available information. Fundamental analysts use a variety of tools and techniques to analyze a company’s financial data, including its balance sheet, income statement, and cash flow statement. The goal of fundamental analysis is to understand the company’s financial health, and to determine its intrinsic value, or the value of the company based on its underlying fundamentals.
Fundamental analysts use a range of financial metrics and ratios to evaluate a company’s financial health and performance. These metrics and ratios may include the company’s revenue, earnings, and profit margins, as well as its debt levels, cash flow, and other financial indicators. Fundamental analysts may also consider the company’s market position, competitive advantage, and growth prospects, as well as its management team and industry trends.
Fundamental analysis is often contrasted with technical analysis, which is a method of evaluating a company’s stock price and trading patterns based on its historical performance and market data. While technical analysis focuses on the stock price and trading patterns, fundamental analysis focuses on the company’s underlying financial health and performance.
Overall, fundamental analysis of stocks is a method of evaluating a company’s financial health and performance, based on its financial statements and other publicly available information. Fundamental analysts use a variety of tools and techniques to analyze a company’s financial data, and to determine its intrinsic value.
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