Just as much as you are interested in investing, you wouldn’t want to spend the whole week checking out the outstanding stock for you. That is what this blog is going to be about today. If you want to know how I pick my stocks in less than an hour, ensure you read this blog till the end.
Hello readers, you are welcome to another edition of my regular blog. Just like others, I promise you will benefit from this blog. It may interest you to check other related blogs like “The Secret of Investing in 2021.” You will be glad you did. And please, if you are yet to be a subscriber, you should subscribe now! Let’s begin.
Steps To Find An Outstanding Stock
Idea
There must be a reason why you want to do something; you don’t just wake up and go to the grocery store without reason; it is not possible, there must be a reason for your going there same goes for investment; you don’t just wake up, and make an investment, there must be something that triggers your interest in the stock you want to buy. The spark may be because you saw everyone talking about it in your place of work, you went to a business meeting, you also overheard people talking about that particular stock, before you know it, something in you is being triggered to consider it, you have gotten the idea. This makes you check on the company. Irrespective of where the idea comes from, something must have brought up the idea.
Research
You don’t just go and invest because the news about the stock is flying around; maybe when you get home, and you are in your personal space, you can choose to Google through the company where outstanding stock is up for sale. Among other things you look out for, you will check if it is a public company like Apple. It would help if you didn’t spend anything less than 5 minutes, making your confirmation on Google. If it is a public company, and you have your brokerage account with money inside, it means you can buy investment into that company. Among the essential points, you should research the company investor relationship. There is nothing pretty difficult about this; that is why you have Google. It will help.
If you are a subscriber, you would have come across so many videos about Investment, where I discussed with you things you should be on the lookout for to avoid risk while making your investment.
Annual report
So, you are also going to be checking out the company’s annual report. Trust me, you wouldn’t want to invest in a struggling company that has nothing to offer you, it is advised that you invest in a well-to-do company, a company with a good reputation and excellent income revenue. The annual report is also known as the 10K report; this is the information about the company’s activities and financial performance; the report is usually comprehensive.
In no time you should read about the company and ensure you understand everything about the company. If you are struggling to understand the company, you should please don’t make any investment.
The rule is to invest in only the company that you understand
I don’t buy stock in a company unless I understand that company and see value in the company. Yes, Value is essential. If you should read about the company like 3-4 times and you are still super confused, please, give up on that company. Understanding is important; there is no need to be desperate or eager to invest because people are doing so; there are so many other companies who has outstanding stock is up for sale that you can buy; take your time and digest everything about the company. Understanding is what gives birth to confidence. If you understand a company, you will have full faith and trust in such a company.
Among other things you are researching is the balance sheet
Does the company have a good balance sheet? You wouldn’t want to invest in a company swimming in debt. If a company is loaded with debt, how is the company going to continue in business? A great balance sheet is what you should be looking out for before making any Investment. You should not fail to check on the company’s revenue for at least three years, are the revenue or profit getting better year in year out? If yes, that is a good buy. Don’t mess around with a company whose revenue generation isn’t getting any better, especially if you are a beginner investor. If you have been investing for a long time now, you should be able to calculate if a company with bad revenue will do well in 5-10 years to come.
Risk Factor
The next thing you should consider is the company’s risk factor. It would be best if you gave it your attention. The risk factor is necessary, and you should read it up in the 10k report; if you are not so comfortable with the risk involved, don’t get yourself involved. You need to be aware of the possible things that could go wrong.
You need to understand how the business is trending; you need to comprehend the update and the change the business is undergoing; this is usually referred to as the company 10Q. Don’t neglect it for anything. It would help if you compared the company’s 10Q to its 10K (annual report), read up everything about the company. You will be glad you got all your necessary updates.
Valuation
You should go ahead and research the company’s valuation. Does the company have a fair valuation? Is the forward P.E fair for growth? These are questions you should take into consideration. If the revenue percentage is incredible, cool, you can go ahead and consider if you are comfortable with the P.E; it depends on what you want. If a company has a 100 P.E as an investor, can you pay for such a company? If you can, good! But, you should check the profitability of the company properly. Don’t go with what you think; you should go with something more realistic.
You can go ahead and watch one of my videos, “Investing advice from the greatest investors,” especially if you are a beginner investor or if you are an experienced investor and you need good advice. The video is packed with so much value.
I hope you enjoy today’s blog regarding steps to find outstanding stock, and I am hoping to see you again. Please do like, share and subscribe to my channel. You can also join my Facebook page to take part in the essential Investment ideas discussed from time to time; you are missing out on so much beneficial information.
Recommended books for further reading:
- Secrets Of The Millionaire Mind – Harv Eker
- Keys to Success – Napoleon Hill
- Money: Know More, Make More, Give More
- Intelligent Investor: The Definitive Book on Value Investing
- The Barefoot Investor: The Only Money Guide You’ll Ever Need
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