While investing in SGX market, it’s important to the fundamental analysis of stocks. The fundamental analysis is all about understanding the company’s business & its future planning’s. Further, you need to analyze the financial statements & annual reports to know the company’s market value.
As fundamental analysis is the basic rule to be followed before investing, investing also comprised of elements of stock value. Here are the elements about stock value are discussed.
Price-to-Book Ratio (P/B):
The price-to-book ratio shows the company’s value if stock price get down or sold at present day. The booking value is generally comprised of bonds & stock holdings. This book value may get fluctuate with the market as the stock price goes up & down. To determine the company’s value, it’s recommended to get STOCK SIGNALS which helps to show you the ratio of market price of a company’s share.
Price-To-Earnings Ratio (P/E):
Generally, the small investors who are beginner in the stock market make heavy losses. Market (PE) methodology can be implemented to know the precise level for investment. As per the study, the market never falls below the level, (PE=10) even if it goes down, it bounce above the 10 PE and extend up to 25 PE. Therefore, you should invest at 10 levels and sell it about 25 PE. It’s recommended to compare the PE ratios between similar industries.
As each company have different growth prospects, it’s not beneficial for investors to compare between high PE & low PE. Getting STOCK TRADING PICKS would be beneficial to know the value of stock price
Source ( http://www.equityprofit.com/blog/3-elements-of-stock-value-to-know/ )
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