COMPANY ANALYSIS
&
STOCK
VALUATION
BD20403
DR IZAAN JAMIL
Important?
Company analysis is a critical step in stock valuation, as it helps investors assess a company's ability to generate earnings and cash flows in the future.
Company analysis involves analyzing a wide range of factors, including financial performance, industry trends, management team, and other factors that can impact a company's future prospects.
By conducting a thorough analysis of a company, investors can gain insights into its strengths and weaknesses, identify potential risks and opportunities, and make more informed investment decisions.
There are many tools and techniques available for conducting company analysis.
Process of Analysis
The company analysis process typically involves several steps, including gathering and reviewing relevant data, conducting financial analysis, performing qualitative analysis, and making investment decisions based on the analysis.
The first step in the process is to gather and review relevant data, which may include financial statements, market data, news articles, and other information sources.
The second step is to conduct financial analysis, which involves reviewing the company's financial statements and using financial ratios and other metrics to evaluate its financial performance and position.
The third step is to perform qualitative analysis, which involves analyzing non-financial factors that can impact the company's future prospects, such as industry trends, competitive positioning, and management quality.
The final step is to make investment decisions based on the analysis, taking into account factors such as risk tolerance,
investment objectives, and the investor's overall investment strategy.
INTRODUCTION
COMPANY ANALYSIS
Company analysis involves
assessing a company's financial and non-financial factors,
including its revenue, expenses, assets, liabilities, management
team, industry dynamics, and competitive positioning.
STOCK VALUATION
Stock valuation involves
estimating the intrinsic value of a company's stock based on its
current and future earnings potential, growth prospects, market sentiment, and other
factors.
SERBA DINAMIK
Hindenburg Research
Adani vs
IF YOU HAVE RM500,000.
WHICH STOCKS ARE YOU
GOING TO BUY?
COMPANY
Company that
consistenly grow sales and earnings at a rate that is faster than the
overall economy.
A company with the management ability and the opportunities
to consistenly make investment that yield rates of return greater
than the firm required rate of return.
GROWTH
Companies whose future earnings are likely to withstand an
economic downturn.
One would expect them to have relatively
low business risk and not excessive
financial risk
DEFENSIVE
A company with sales and earnings will be heavily influenced by
aggregate business activity.
A company that outperform other
company during economic expansions
and seriously
underperform during economic
contractions.
CYCLICAL
SWOT ANALYSIS (BANK ISLAM)
OPPORTUNITIES
WEAKNESS
STRENGTHS
THREATS UNDERPERFORMED
THIRD PARTY CONTROL
SHARIAH COMPLIANCE
FINANCIAL SERVICE PROVIDER
EXPANSION FIERCE COMPETITION
A quantitative method of valuing a company’s stock price based on the
assumption that the current fair price of a stock equals the sum of all of the company’s future dividends
discounted back to their present value.
DISCOUNTED CASH FLOW
DIVIDEND
DISCOUNT MODEL
P/E RATIO
A valuation that measure of the share price relative
to the annual net income earned by the company
per share.
A valuation method that estimates the value of an investment using
its expected future cash flows.
DCF analysis attempts to determine the value of an investment today, based on projections of how much money that investment will generate in the
future.
SHARE PRICE EARNING PER
SHARE
P/E RATIO =
MAYBANK PE RATIO
MAYBANK
CIMB
STOCK
A stock with a higher expected rate of return than other stocks in the market
with similar risk characteristics.
GROWTH
Rate of return for this stock is not expected
to decline during an overall market decline.
A stock which is unlikely to be harmed significantly in a bear
market.
DEFENSIVE
A company with sales and earnings will be heavily influenced by
aggregate business activity.
A company that outperform other
company during economic expansions
and seriously
underperform during economic
contractions.
CYCLICAL SPECULATIVE
Stock that possesses a high probability of low or negative rates
of return.
An overpriced stock that will lead to high probability that during the future period when the market adjusts the stock price to its true
value, it will
experience either low or negative rates of
return.
