Information about competitors can be found in company profiles on most major research sites, usually along with their ticker or direct comparisons that let you review a list with certain metrics filled in for both the company you're researching and its competitors.If you're still uncertain of how the company's business model works, you should look to fill in any gaps here before moving further along.A quick calculator check could be done to confirm the price-to-sales (P/S) ratio and the price-to-earnings (P/E) ratio.Look at the recent trends in both sets of figures, noting whether growth is choppy or consistent, or if there any major swings (such as more than 50% in one year) in either direction.Sometimes just reading about some of the competitors may help to understand what your target company actually does.
Look up the revenue and net income trends for the past two years at a general finance website like Yahoo! These should have links to quarterly (for the past 12 months) and annual reports (past three years).
You sit down at your computer with a fresh cocktail napkin or sticky note that has a single ticker scribbled across it - it's a ticker you've never researched before, but something (or someone) has piqued your interest.
This article will discuss 10 steps you should take on your first tour through a new stock.
This due diligence allows you to gain essential information and vet out a possible new investment.
The steps are organized so that each new piece of information will build upon what has been previously learned.
In the end, following these steps will give you a balanced view of the pros and cons of your investment idea, and allow you to make a rational, logical decision.