Fundamental Analysis

EBITDA stands for earnings before interest, taxes, depreciation and amortization. It’s a financial metric commonly used to evaluate a company’s financial performance and its ability to generate cash flow. This post will cover EBITDA in detail, including what it tells you, when to use it to evaluate businesses, and its limitations.  What is EBITDA? EBITDA …

Free cash flow, or FCF, is the cash a company generates after it accounts for outflows required to maintain business operations and support capital expenditures. Many investors consider FCF a better measure of profitability than net income or earnings, as it excludes non-cash expenses and accounts for capital spending and changes in net working capital …

Earnings Per Share (EPS) is a financial ratio investors use to evaluate a company’s profitability. It represents the portion of a company’s net earnings allocated to each outstanding share of common stock. By examining EPS, you gain valuable insights into a company’s ability to generate and distribute profits to its shareholders. This article will cover …

Some businesses invest their shareholders’ capital wisely, turning every dollar into significantly more profit. These companies create long-term value and drive strong stock performance for investors. But other companies waste capital through unprofitable expansion or poor decisions. These companies see poor returns, weak profitability, and they’ll ultimately see poor stock performance over the long term. …

Return on Equity (ROE) is a financial ratio that reflects a company’s profitability in relation to the equity invested by shareholders. It basically measures how effectively a company utilizes investors’ funds to generate profits.  The ratio is vital in assessing a company’s financial performance and comparing it to that of its industry peers. In this …

Financial analysts and investors look at various metrics before deciding whether a stock is a buy. One of the metrics is the price-to-earnings ratio (P/E ratio).  The P/E ratio tells you whether a company’s stock price is overvalued, fairly valued, or undervalued. It also gives insight into a stock’s value compared to its industry peers. …