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Strategies & Market Trends : Due Diligence - How to Investigate a Stock -- Ignore unavailable to you. Want to Upgrade?


To: Eggolas Moria who wrote (68)3/29/1999 9:59:00 PM
From: Stitch  Read Replies (1) | Respond to of 752
 
Gary,

<<I like to read the most recent 10-K and the three 10-Q's prior. >>

That is, on average, what I read when attracted to a stock. I find I never read financials unless something has attracted me to the stock in the first place. (sector analysis, story stock, whatever) But I have been known to go further back before pulling the trigger. But history only goes so far because the market tends to want to predict the future and it is the story going forward that most investors are interested in. This means getting very familiar with the company's rational for revenue growth. Of course every company has a "Future Looks Bright Ahead" story. This argues heavily for some sort of sector analysis. I think it is important to see how the company you are looking at stacks up against the competition. I find that SI is a wonderful place to monitor news on the competition by the way. Also I find it difficult to stray too far with confidence and confine my investing to four industries. Thats one reason I consign a portion of my holdings to professional management and cash equivalents. The percentages have changed as I grow older as well, reflecting a more protective stance.

Best,
Stitch