Long post:
– Koyfin: Screen fundamentals
– Wikipedia: Read Story behind their company
– Company Site: What they do
– Seeking Alpha: Latest “analysis”, Check if there is a VIC analysis
– SEC Site: Read 10k and 10Q
– Check Dataroma how many are holding the company
– Figure out the business Risks
– Ask yourself if you know what the market doesn’t
– Is the price inferior to the value that you are getting?
I also always try to answer these questions:
##Be capable of understanding
– [ ] Is this company inside my Circle of Competence?
– [ ] Are any of my Gurus buying or selling this company?
– [ ] What is my overall level of confidence with my research into this company?
– [ ] Describe the business and industry in one paragraph.
– [ ] Describe the challenges and economic cycles of this industry.
– [ ] What are the company’s plans for growth?
– [ ] Will growth peak within ten years?
## Moat
– [ ] What is the Moat?
– [ ] How hard is it to compete with this company?
– [ ] Compare this company to its competition.
– [ ] What are the Big Four Growth Rates (Net Income, Book Value, Sales, Operating Cash)? Are they speeding up or slowing down?
– [ ] Does the company have enough cash to last several year if it looses money?
– [ ] How were sales and earnings during the last recession?
## Management
– [ ] Does the CEO have integrity?
– [ ] How candid is the CEO’s letter to shareholders?
– [ ] Does management talk freely to investors when things are going well but clam up or disclaim responsibility when trouble occurs?
– [ ] How happy are its employees?
– [ ] Does the company have any debt? If yes, could it be paid with one or two years of free cash flow?
– [ ] Has the company indicated that it plans to take on debt any time in the future?
– [ ] Is the management team buying or selling its company’s stock?
– [ ] Is the CEO much on social media, posts political views or hates short sellers (Red Flag)
– [ ] How are the Return on Equity and Return on Invested Capital Numbers of the year?