How do investors analyze the fundamentals of listed companies

Grasping the investment value of listed companies needs to be implemented in the company's own operating conditions and development prospects. Investors need to know the company's position in the industry, market share, financial situation, future growth and other aspects in order to make their own investment decisions. I. Fundamental analysis of the company 1. The comprehensive ranking of the company's industry position analysis in the industry and the market share of products determine the company's competitive position in the industry. The profitability of leading enterprises is usually higher than the industry average. 2. Analysis of the company's economic location The natural and basic conditions in the economic location include mineral resources, water resources, energy and transportation. If the industries engaged by listed companies meet the local natural and basic conditions, it will be more conducive to promoting their development. In addition, according to the strategic plan of economic development, the local government will give corresponding preferential measures in finance, credit and taxation to the industries that are given priority development and support in the region, which is conducive to the further development of listed companies in related industries. 3. Company product analysis The products or services provided by the company are the source of its profits. Analyzing and forecasting the market prospect and profit trend of the company's main products can help investors better predict the company's future growth and profitability. Generally speaking, the company's products have comparative advantages in cost, technology and quality, and it is easier to obtain excess profits higher than the industry average profit level; The higher the product market share, the more stable the company's profit level; Company products with brand advantages can often get corresponding brand premium. 4. The company's business strategy and management strategy are long-term plans for the company's business scope, growth direction, speed and competitive countermeasures, which are directly related to the company's future development and growth. The quality and ability of management also play a key role in the development of the company. Excellent listed companies should have long-term sustainable competitive advantages and good development prospects, and at the same time have a corporate governance mechanism that rewards investors with sustained and stable cash dividends. Paying attention to cash dividends can, on the one hand, rationally allocate the funds of listed companies and curb the blind expansion of investment; On the other hand, it will help attract long-term funds to enter the market, stabilize the company's share price, and fully guarantee the stability of investors' income. Second, the company's financial analysis The financial statements of listed companies are the epitome of their production and operation activities for a period of time, and are an important basis for investors to understand the company's operating conditions and predict future development trends. The financial statements published by listed companies mainly include balance sheet, income statement and cash flow statement. The balance sheet reflects the financial situation of the company at a specific time (usually at the end of the quarter or the end of the year), and reflects the situation between the company's assets, liabilities and shareholders' equity at that time; The income statement reflects the production and operation results of the company in a certain period of time, and reflects the various components of the company's profits; The cash flow statement reflects the inflow and outflow of cash in a certain period, indicating the company's ability to obtain cash and cash equivalents. We usually use financial ratio analysis, such as asset-liability ratio and return on net assets, to reveal the company's current operating conditions. Through financial analysis, investors can not only better understand the operating conditions of listed companies, but also help to find problems in the operation of listed companies or identify false accounting information. For example, in the case of Blue Sky, in 2000, the current ratio and quick ratio of Blue Sky were 0.77 and 0.35 respectively, which were about 5 times lower than the industry average and 1 1 times respectively. It shows that the short-term convertible current assets of Lantian Co., Ltd. are not enough to repay the due current liabilities, and only 35% of the due current liabilities can be repaid after deducting the inventory. And from 1997 to 2000, the turnover rate and current ratio of fixed assets of Lantian Co., Ltd. decreased year by year. By 2000, both of them were less than 1, and its ability to repay short-term debts became weaker and weaker. Combined with the company's sales revenue, cash flow and asset structure analysis, Lantian's solvency is getting worse and worse. After deducting all kinds of costs and expenses, the company has no source of net income, and cannot create enough cash flow to maintain normal business activities and ensure timely repayment of the principal and interest of bank loans. In addition, the cash dividend policy is also one of the important yardsticks to measure whether an enterprise has investment value. Dividend rate, dividend rate and other indicators can be used to measure the return level of investors in listed companies. Dividend payment rate refers to the ratio of cash dividend to net profit, and dividend rate refers to the ratio of dividend to stock price. If a listed company pays a high proportion of cash dividends continuously and steadily, and the annual cash dividend rate exceeds 1 year bank deposit rate for many years, this stock can basically be regarded as a profitable stock with long-term investment value. However, if profitable companies do not pay dividends for a long time, investors should be careful. A few listed companies may cheat investors by exaggerating or fabricating operating income and net profit, but there is no way to falsify cash dividends paid to investors. Therefore, paying attention to the cash dividend policy of listed companies will also help investors to judge the authenticity of the company's operating conditions. Third, the company's valuation method The logic of company valuation lies in "value determines price". The valuation methods of listed companies are usually divided into two categories: one is relative valuation method; The other is the absolute valuation method. 1. Relative valuation method is simple and easy to understand, and it is also widely used by investors. In relative valuation methods, commonly used indicators include price-earnings ratio (PE), price-to-book ratio (PB), EV/EBITDA multiple, etc. The multiple obtained by the relative valuation method is used for the relative valuation level between companies in the same industry. The index values of companies in different industries cannot be directly compared, and the differences may be great. The relative valuation method reflects whether the current price of the company's stock is at a relatively high or low level. By comparing different companies in the industry, we can find out the relatively undervalued companies in the market. But this is not absolute. For example, if the market gives the company a higher price-earnings ratio, it shows that the market is optimistic about the company's growth prospects and is willing to give a certain premium to the dominant companies in the industry. Therefore, when using relative valuation indicators to analyze the company's value, it is necessary to analyze specific companies in combination with macroeconomics, industry development and company fundamentals. Compared with the absolute valuation method, the relative valuation method has the advantages of being simple and easy to be mastered by ordinary investors, and it also reveals the market's evaluation of the company's value. However, when the market fluctuates greatly, the P/E ratio and P/B ratio also change greatly, which may mislead the company's value evaluation. 2. Absolute valuation method In the absolute valuation method, the commonly used dividend discount model and free cash flow discount model adopt the capitalization pricing method of income. By forecasting the company's future dividend or future free cash flow, the intrinsic value of the company's stock can be obtained through discount. When analyzing the investment value of listed companies, investors need to combine the macro, industry, financial status, market valuation level and other information of listed companies to distinguish the main factors and secondary factors, sustainable factors and unsustainable factors that affect the stock price of listed companies, so as to make an objective and rational value evaluation of listed companies.