Is this a good Stock?

How do you know if you should invest in a stock? There are some standard ways that you can use to evaluate a stock. Start with the ticker symbol or the letters that identify a stock on a stock exchange. You can usually find out the following:

last traded value - most recent per share prince that it was purchased at
net change - how much it has gone up or down
bid price - most recent amount offered for it
ask price - most recent amount someone has offered to see the stock for
day high and low - highest and lowest price for the day
volume traded - number of shares trade in the last day
52 week high and low - highest and lowest price for the year
price

Plus the really important stuff:
P/E- Price to earnings ratio. The lower the number is usually the better.
EPS - amount of earnings the company generates per each share of stock that exists. The more generated the better.
Dividend & % - shows the current dividend and the percent of earnings that the dividend represents. Not all companies issue dividends.
Capitalization - the total number of outstanding shares times the price per share. There are large and small cap companies. Generally the smaller the market cap of a stock the riskier it is.

When you examine this information along with company listings of financial information you see if the company is financially sound and if its revenues and earnings have been increasing on a regular basis.

You'll need to look at how much debt or loans the company has. In general, less debt is better than a lot of debt. Also look at how well the company is doing in comparison to its competitors and the industry too.


There are print and online resources that provide financial information on individual stocks and industries.