This is a quick & dirty list of the most important things to look for when researching companies or stocks to invest. Keep in mind that this is not a complete list nor does the company or stock have to pass every single point. Although, we would recommend that the majority of points be reached; however, each case, must be weighed individually.
• Possess an Economic Mote
• Consistent EPS for past ten years (if applicable)
• Free Cash Flow
• Low Debt Ratio
• Brand Power
• Compare stock & company to the competition
• A Discounted share price/Margin of Safety
• Revenues
• Return on Equity
• Consistent Dividends (Recommended for a long term play, not necessary for short plays)
General Practices:
• Always use a Stop-loss for short plays
• Minimize all expenses, fees, commissions, and taxes
• Read stock reports & news daily
• Do not use margin or acquire debt
• Be wary of trends
Remember K.I.S.S. Keep It Simple Stupid. All of these hair-brained ideas, systems or theories of technical analysis/charting are a total waste of time. Simply, pick great companies at a discounted share price. Presto; you win.
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