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F Fu Open the book and find: u It’s more important than ever for investors to know the true (cid:127) W hat to always look for when n fininvaensctoiarl osrt ajubsilti twy aonf ta t bou lesianrens hs.o Wwh teot hmear kyeo um’roer ea isnetaesloligneendt (cid:127) s Ttiupds ytoin dge ate cromminpea nify a company’s da A n a l ys i s and prudent investment decisions, this no-nonsense credit standing is in jeopardy m guide gives you practical tips, tricks, and secrets for using (cid:127) R eal examples of how fundamental analysis to manage your portfolio and e fundamental analysis unearthed enhance your current system of selecting stocks! secrets investors wanted to know n t (cid:127) What is fundamental analysis and why should you use it? — (cid:127) Online tools to make analysis a understand who should use fundamental analysis, how you can easier l use it, and get up-to-speed on why it gives investors an edge (cid:127) A checklist of things to consider in A (cid:127) How to perform fundamental analysis — get practical guidance every annual report n on how to perform fundamental analysis to analyze and (cid:127) Advice on how a good company in a measure a company’s profitability, financial resources, cash a bad industry can still make you flow, and more l money y (cid:127) Looking for fundamental reasons to buy or sell — find out how to s look for buy or sell signals (cid:127) W hy trends are important to i investors s (cid:127) Making money from fundamental analysis — learn how to pay the right price for a stock and get tips on how an annual report can be used to find out what a company is worth to you Learn to: (cid:127) Getting advanced with fundamental analysis — get tips on how digging into the industry’s fundamentals, finding trends, (cid:127) Assess the future value of a business recognizing red flags, and technical analysis keeps investors at Go to Dummies.com® the top of their game for videos, step-by-step photos, (cid:127) Evaluate internal management how-to articles, or to shop! (cid:127) Gauge a company’s performance against its competitors (cid:127) Make informed investments in both bear and bull markets $24.99 US / $29.99 CN / £16.99 UK Matt Krantz is a writer and reporter for the Money section of USA Today ISBN 978-0-470-50645-5 and USAToday.com, where he covers investments and financial markets. He also writes a daily column for USAToday.com, “Ask Matt,” which answers readers’ investment questions. The author of Investing Online For Dummies, Matt Krantz Krantz has appeared on Nightly Business Report and FOX Business. Krantz Financial Markets Reporter, USA Today spine=.76” Get More and Do More at Dummies.com ® Start with FREE Cheat Sheets Cheat Sheets include (cid:127) Checklists (cid:127) Charts (cid:127) Common Instructions (cid:127) And Other Good Stuff! To access the Cheat Sheet created specifically for this book, go to www.dummies.com/cheatsheet/fundamentalanalysis Get Smart at Dummies.com Dummies.com makes your life easier with 1,000s of answers on everything from removing wallpaper to using the latest version of Windows. Check out our (cid:127) Videos (cid:127) Illustrated Articles (cid:127) Step-by-Step Instructions Plus, each month you can win valuable prizes by entering our Dummies.com sweepstakes. * Want a weekly dose of Dummies? Sign up for Newsletters on (cid:127) Digital Photography (cid:127) Microsoft Windows & Office (cid:127) Personal Finance & Investing (cid:127) Health & Wellness (cid:127) Computing, iPods & Cell Phones (cid:127) eBay (cid:127) Internet (cid:127) Food, Home & Garden Find out “HOW” at Dummies.com *Sweepstakes not currently available in all countries; visit Dummies.com for official rules. Fundamental Analysis FOR DUMmIES ‰ 0011 550066445555--ffffiirrss..iinndddd ii 99//2244//0099 1100::0011::3333 PPMM 0011 550066445555--ffffiirrss..iinndddd iiii 99//2244//0099 1100::0011::3333 PPMM Fundamental Analysis FOR DUMmIES ‰ by Matt Krantz 0011 550066445555--ffffiirrss..iinndddd iiiiii 99//2244//0099 1100::0011::3333 PPMM Fundamental Analysis For Dummies® Published by Wiley Publishing, Inc. 111 River St. Hoboken, NJ 07030-5774 www.wiley.com Copyright © 2010 by Wiley Publishing, Inc., Indianapolis, Indiana Published by Wiley Publishing, Inc., Indianapolis, Indiana Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permit- ted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http:// www.wiley.com/go/permissions. Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man logo, A Reference for the Rest of Us!, The Dummies Way, Dummies Daily, The Fun and Easy Way, Dummies.com, Making Everything Easier, and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/ or its affi liates in the United States and other countries, and may not be used without written permission. All other trademarks are the property of their respective owners. Wiley Publishing, Inc., is not associated with any product or vendor mentioned in this book. LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: THE PUBLISHER AND THE AUTHOR MAKE NO REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF THE CONTENTS OF THIS WORK AND SPECIFICALLY DISCLAIM ALL WARRANTIES, INCLUDING WITH- OUT LIMITATION WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE CREATED OR EXTENDED BY SALES OR PROMOTIONAL MATERIALS. THE ADVICE AND STRATEGIES CONTAINED HEREIN MAY NOT BE SUITABLE FOR EVERY SITUATION. THIS WORK IS SOLD WITH THE UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING LEGAL, ACCOUNTING, OR OTHER PROFESSIONAL SERVICES. IF PROFESSIONAL ASSISTANCE IS REQUIRED, THE SERVICES OF A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. NEITHER THE PUBLISHER NOR THE AUTHOR SHALL BE LIABLE FOR DAMAGES ARISING HEREFROM. THE FACT THAT AN ORGANIZA- TION OR WEBSITE IS REFERRED TO IN THIS WORK AS A CITATION AND/OR A POTENTIAL SOURCE OF FURTHER INFORMATION DOES NOT MEAN THAT THE AUTHOR OR THE PUBLISHER ENDORSES THE INFORMATION THE ORGANIZATION OR WEBSITE MAY PROVIDE OR RECOMMENDATIONS IT MAY MAKE. FURTHER, READERS SHOULD BE AWARE THAT INTERNET WEBSITES LISTED IN THIS WORK MAY HAVE CHANGED OR DISAPPEARED BETWEEN WHEN THIS WORK WAS WRITTEN AND WHEN IT IS READ. For general information on our other products and services, please contact our Customer Care Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002. For technical support, please visit www.wiley.com/techsupport. Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. Library of Congress Control Number: 2009936811 ISBN: 978-0-470-50645-5 Manufactured in the United States of America 10 9 8 7 6 5 4 3 2 1 0011 550066445555--ffffiirrss..iinndddd iivv 99//2244//0099 1100::0011::3344 PPMM About the Author Matt Krantz is a nationally known fi nancial journalist who specializes in invest- ing topics. Krantz has been a reporter and writer for USA TODAY since 1999. He covers fi nancial markets and Wall Street, concentrating on developments affecting individual investors and their portfolios. His stories routinely signal trends investors can profi t from and sound warnings about potential scams and things investors should be aware of. In addition to covering markets for the print edition of USA TODAY, Matt writes a daily online investing column called “Ask Matt,” which appears every trading day at USATODAY.com. He tackles questions posed by the Web site’s giant audience and answers them in a plain-English and straightforward way. Readers often tell Matt he’s the only one who has been able to fi nally solve investing questions they’ve sought answers to for years. Matt has been investing since the 1980s and has studied dozens of investment techniques while forming his own. Before joining USA TODAY, Matt worked as a business and technology reporter for Investor’s Business Daily and was a consultant with Ernst & Young prior to that. He earned a bachelor’s degree in business administration at Miami University in Oxford, Ohio. Matt is based in USA TODAY’s Los Angeles bureau. When he’s not writing he’s either spending time with his wife and young daughter, running, moun- tain biking, or surfi ng. 0011 550066445555--ffffiirrss..iinndddd vv 99//2244//0099 1100::0011::3344 PPMM 0011 550066445555--ffffiirrss..iinndddd vvii 99//2244//0099 1100::0011::3344 PPMM Dedication This book is dedicated to my wife Nancy, who has helped me do my best, my parents for urging me to do my best, my grandparents for inspiring me to do my best, and my daughter Leilani for giving me a reason to do my best. Author’s Acknowledgments Taking on a project with the size and scope as this book would have been overwhelming without the help of key people along the way. My wife, Nancy, is always there ready with an encouraging pat or a suggestion for the perfect word that is eluding me. My assignment editor, David Craig, and other USA TODAY editors have been supportive of my writing and journalism career from the start. Steve Minihan, a fi nancial advisor and professor for UCLA Extension, has provided invaluable instruction and analysis skills. Fane Lozman shared his options expertise. The team at Wiley has also been very supportive, including: Acquisitions Editor, Erin Calligan Mooney; Project Editor, Jennifer Connolly; and Technical Reviewer, Paul Mladjenovic. And again, a big thanks to Matt Wagner, my literary agent, for letting me know about this opportunity. Finally, I wanted to thank my family for giving me the tools and determination to pursue my interest in writing and investing. My mom and dad taught all their kids they could achieve their goals if they always did their best and never stopped trying to get even better. And my grandparents are models of long-term success I continue to strive for. 0011 550066445555--ffffiirrss..iinndddd vviiii 99//2244//0099 1100::0011::3344 PPMM Publisher’s Acknowledgments We’re proud of this book; please send us your comments at http://dummies.custhelp.com. For other comments, please contact our Customer Care Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002. Some of the people who helped bring this book to market include the following: Acquisitions, Editorial, and Media Composition Services Development Project Coordinator: Sheree Montgomery Project Editor: Jennifer Connolly Layout and Graphics: Ashley Chamberlain, Acquisitions Editor: Stacy Kennedy and Melissa K. Jester, Mark Pinto Erin Calligan Mooney Proofreader: Jennifer Theriot Copy Editor: Jennifer Connolly Indexer: Infodex Indexing Services Assistant Editor: Erin Calligan Mooney Editorial Program Coordinator: Joe Niesen Technical Editor: Paul Mladjenovic Editorial Manager: Jennifer Ehrlich Editorial Supervisor: Carmen Krikorian Editorial Assistant: Jennette ElNaggar and David Lutton Cover Photos: © iStock Cartoons: Rich Tennant (www.the5thwave.com) Publishing and Editorial for Consumer Dummies Diane Graves Steele, Vice President and Publisher, Consumer Dummies Kristin Ferguson-Wagstaffe, Product Development Director, Consumer Dummies Ensley Eikenburg, Associate Publisher, Travel Kelly Regan, Editorial Director, Travel Publishing for Technology Dummies Andy Cummings, Vice President and Publisher, Dummies Technology/General User Composition Services Debbie Stailey, Director of Composition Services 0011 550066445555--ffffiirrss..iinndddd vviiiiii 99//2244//0099 1100::0011::3344 PPMM
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