Understanding Stock Fundamentals: Key Metrics and Analysis
What Are Stock Fundamentals?
Stock fundamentals are the key metrics that reveal a company’s financial health, such as cash flow, return on assets (ROA), and profitability. Fundamental analysis uses these metrics to evaluate a stock’s true value and identify the data points most likely to influence its price. By understanding stock fundamentals, investors can make more informed decisions, choosing investments based on solid financial insights rather than speculation.
Key Takeaways
- Stock fundamentals include key metrics like cash flow and return on assets used to assess a company’s value.
- Fundamental analysis identifies undervalued stocks by scrutinizing financial statements and future growth prospects.
- This process involves…
