Fundamental
analysis is an analytical technique that is commonly used by investors to help
share purchase decisions. This article will discuss fundamental analysis with a
thorough enough. Starting from the definition, function, and a variety of
analytical techniques were used to find the best stocks for investment. By
reading this article, you understand about the use of Fundamental Analysis in
general.
WHAT IS FUNDAMENTAL ANALYSIS?
Fundamental
Analysis or Fundamental Analysis is an analytical technique that takes into
account various factors, such as the performance of the company, business
competition analysis, industry analysis, analysis of macro-economic and
micro-markets. From here it can be seen whether the company is healthy or not.
From checking the investor can find out which companies are in good condition
and can be selected for investment.
WHO IS USING FUNDAMENTAL ANALYSIS?
Fundamental
analysis is generally the investors, especially long-term stock investors.
ANALYSIS FUNDAMENTAL ANALYSIS CAN
ANYTHING?
Fundamental
analysis is not limited to stocks, can also be used for forex, gold. The trick
was different. But usually when people call Fundamental analysis usually refers
to the stock. Investors who use pure fundamental aspect in determining
investment decisions called the Fundamentalist.
WHAT NEEDED TO FUNDAMENTAL ANALYSIS
CAN DO?
Fundamenal
analysis requires the data to be analyzed. Data can be obtained from a variety
of news, economic data and financial reports released by issuers listed on the
Indonesia Stock Exchange.
•
News of Companies can be obtained from newspapers, electronic media
•
Economic data can be obtained from the Central Bureau of Statistics releases or
Bank Indonesia.
•
Data on the company's financial report released by listed companies every three
months (quarterly). Can be found on the company's website or in the respective
Indonesia Stock Exchange website
Actually
we do not have to bother looking for a variety of news and financial reports of
companies that broker where you open stock accounts provide it. For example, if
you open an account through JurusCUAN shares, then you just open the software
online stock trading HOTS and all available there.
See Also January Effect In Stock Market
HOW TO MAKE FUNDAMENTAL ANALYSIS?
In
the Fundamental Analysis we can do a top-down analysis from macro economic
conditions of the country until conditions in micro enterprise.
•
Macro analysis to determine the condition of the country's economy as a whole.
We need to see whether the economy is still growing, inflation is threatening
growth, and so on. The country's economy is growing will encourage the growth
of these companies.
•
Sectoral Analysis (Industry) to determine the condition of each industry. We
need to know what most industry sectors have a chance to grow.
•
Micro analysis to determine the condition of the company. Which can be done by
measuring the financial health of the company, seen from the financial
statements that is issued.
FUNCTION IS FUNDAMENTAL ANALYSIS?
Fundamental
analysis has several uses in the equity investment, among others:
1.
Detect the right moment to enter or exit the stock market
By
knowing how the country's economic conditions, we can know when we have to
invest.
2.
Help pick a good stock for investment
With
the industry analysis and corporate finance we can avoid companies that have
less obvious fundamental
3.
Knowing the fair price of a stock
Fundamental
analysis can be used to determine the valuation of shares, ie how many shares
it worth the nominal rupiah appreciated. There are many methods that can be
used to calculate stock valuations, for example:
•
Methods PER (Price Earning Ratio)
•
Methods PBV (Price to Book Value Ratio)
•
Methods of DDM (Dividend Discounted Model)
•
Discounted Cash Flow method (DCF)
•
Method of Free Cash Flow (FCF)
WHAT IS A FINANCIAL RATIO?
To
facilitate the assessment of the financial statements, analysts use a variety
of financial ratios. Fortunately it's a lot of media and business newspapers
also provide the data these ratios. In addition you can also find these ratios
in the online trading platform, or from the Internet. Examples of commonly used
financial ratios are:
•
EPS (Earning Per Share), or earnings per share
•
PER (Price Earning Ratio) or the ratio of stock price than the company's profit
•
PBV (Price to Book Value Ratio) or the ratio of stock price compared to the
accounting value of the company
•
ROE (Return On Equity), or the ratio of profit than the company's capital
•
DER (Debt Equity Ratio) or the company's debt ratio than the capital
•
and many other ratios
These
financial ratios are also available in HOTS.
HOW TO DO ANALYSIS OF FINANCIAL
STATEMENTS?
The
trick is to compare:
•
Comparing the performance of a company over a few periods. This way you will be
able to know the trend of the company's performance, whether growing or not.
•
Comparing a company with another company in the same sector. This way you will
be able to choose the best company in the sector.
Fortunately
both methods can be easily done using HOTS