The Level of Competition and Future Industry Prospects

The Level of Competition and Future Industry Prospects
The Level of Competition and Future Industry Prospects

Pay attention to the latest trends whether the growth is fluctuating or consistent of Fidelity netbenefits. Or is there a big change (more than 50% in a year) up and down direction. Also check the company’s margins whether the trend is generally up, down, or stay the same.

Rapid technological developments often kill companies that are not ready. Do not let you get stuck buying shares of companies that are insensitive to changes.

You can compare a company with a competitor to measure how big the overall market share is for the products that the company produces. Do not forget to projection the future of the industry. Whether it can survive or tend to decline.

Create Multiple Ratio Analysis Here in choosing a good stock, there are several ratios to note, namely:

The price-earnings ratio is calculated by dividing the stock price by the earning per share of a company. Make sure the net earnings figure for several years to ensure the numbers are normal and not skyrocketed due to drastic changes.

Price-to-book-ratio to know the fair value of shares. This indicator is obtained by dividing the stock price in the stock market with the book value of the stock.

Price per earnings to growth ratio to take into account future earnings growth expectations and compare them with current earnings conditions. Shares with a PEG ratio close to 1 are usually valued as valuable under normal market conditions.

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