Want to learn basics of Fundamental Analysis

[wbosher]

I am going to be out of the stock market for probably at least six months, and am thinking about learning about the basics of FA during this time. I've heard the term "intrinsic value" floating about, and would like to learn how one calculates this value.

I've done a Google search on calculating this "intrinsic value" and it threw up several thousand web pages, most of which at first glance seem to contradict each other. I was wondering if anyone on this forum could give me some tips, or point me in the direction of a web site which will have some good basic information.

I only really want to know the basics at this stage since I use TA primarily, so don't want to be reading through a 400 page book or anything like that. If anyone can help me out, that would be very much appreciated.

[ENP]

Read the book "The New Buffettology"

Best book on stocks I've ever read.

A good website here: http://www.investopedia.com/articles/01/071801.asp

[darksentinel]

I'd recommend taking a look at The Intelligent Investor, by Bejamin Graham.
http://en.wikipedia.org/wiki/The_Intelligent_Investor

Oddly enough, I did my initial reading in the FA field, and am now starting to read about TA.

[wbosher]

Read the book "The New Buffettology"

I read somewhere that trying to use Buffets method of investing isn't necessarily going to work for everyone, simply because of the amount of money he can invest.

He has a huge advantage over someone with only a few thousand $$$, and because he can buy massive amounts of shares in a company, he gets a say in how it runs. Also, he gets better access to company information and a direct relationship with management. All this is something the average Joe Blow like us can only dream of.

[ENP]

I read somewhere that trying to use Buffets method of investing isn't necessarily going to work for everyone, simply because of the amount of money he can invest.

He has a huge advantage over someone with only a few thousand $$$, and because he can buy massive amounts of shares in a company, he gets a say in how it runs. Also, he gets better access to company information and a direct relationship with management. All this is something the average Joe Blow like us can only dream of.

I'd rather base my investments on the best investor of all time rather than Joe Blow down the street though.

[wbosher]

I'd rather base my investments on the best investor of all time rather than Joe Blow down the street though.

Where can I find historical data like EPS etc...?

Some companies only offer financial reports going back a couple of years on their web sites.

[ENP]

Where can I find historical data like EPS etc...?

Some companies only offer financial reports going back a couple of years on their web sites.

Ever thought about giving the company you are looking to invest in a phone call?

[wbosher]

Ever thought about giving the company you are looking to invest in a phone call?

Like I said, I'm out of the market for at least 6 months, probably longer. At this stage I'm just curious about FA, and how to work out if a stock is over or under valued. Not looking at investing in anyone in particular.

I am mainly a short to medium term trader, using only TA. Just want to use my time away from the market to explore new things.

[ENP]

over or under valued

Then read all you can on "value investing"

.... simple?

What's the issue here?

[darksentinel]

One other thing further on my suggestion of reading "The Intelligent Investor". Warren Buffet was a student of Benjamin Graham who introduced the concept of 'value investing'. Buffet expanded on the concept of value investing, and, as you pointed out, involved himself with company management for much greater added value. However Graham's original ideas are focused more on identifying the value of companies and thus is perhaps more useful than the Buffet approach for retail investors.
Another good read is Security Analysis, by Benjamin Graham and David Dodd. Both 'Security Analysis' and 'The Intelligent Investor' are quite old but have been reprinted and revised.