Understanding a Company Summary

Understanding a Company Summary

Start the new year with some new knowledge. This year will be a great year for investing, well, for some people. Never have fear in the stock market, especially when you hear "professional analysts" talking about how bad the market will do. Never let someones opinion set you off. Set rules for yourself, invest wisely, and diverse a portfolio, and you will make it one day. 

I will describe each segment in as much depth as I feel necessary for you to understand what they mean if you do not understand already. This is a company summary of Starbucks Corporation or the ticker symbol SBUX. One of my best performers in my own portfolio actually. 

Previous Close means that the price labeled to the right of it, is the securities closing price on the preceding day of trading. It is the value of the stock, bond, commodity, futures, or an option contract, market index, or any other type of security you may invest it from the previous day it closed on.

Open, this is basically the price that the stock opened on at the time of the market. So as you can see here, in the after market, the stock rose $0.03 and opened slightly higher than it Previously Closed.

Bid, this is the highest price in the market for the stock.

Ask, or an offer price, is the lowest price a seller of a particular stock is willing to sell a share of the given stock. 

1y Target Est, this represents the median target price for a stock based on analysts covering and researching the stock.

Beta, any beta less than 1 most likely means that the security will be less volatile than the market (this is usually what I look for when investing long-term), if the beta is greater than 1 the securities volatility will be more than the market. 

Next Earning Date, this is an official public announcement of a company's profitability for a specific time period, usually by quarter or annually. It is usually made on a specific date.

Days Range, this is the difference between the low and high prices for a security or index of a specific period of time. (the day)

52wk Range, this is the securities lowest and highest price at whig a stock has traded in the previous 52 weeks. 

Volume, I gave a brief description in the terminology section on a few posts ago, but this is the number of shares or contracts traded in a security or market during a given period of time. Amount of shares that are traded between buyers and sellers as a measure of activity. 

Avg Volume, this is over a longer period of time, it is the total amount traded in that period, divided by the length of the period. 

Market Cap, or market capitalization, is the total market value of the amount of shares outstanding of a PUBLICLY traded company. This is equal to the share price X the number of shares outstanding.

P/E Ratio, or Price-Earnings Ratio, this is Market Value per Share/Earnings per Share. What this does is it values a company that measures its current share price relative to its per-share earnings. In essence, this can indicate what dollar amount an investor, as yourself, can expect to invest into a company you like in order to receive one dollar of the company's earnings. 

EPS, or Earnings per Share, this is a company's profit divided by the number of common outstanding shares. Easy right?

Dividend and Yield, MY FAVORITE, this is a financial ratio that indicates how much company pays out in dividends each year that is relative to its share price. It is a percentage and can be calculated by using this formula, Annual dividends per share/price per share. Good way to have cash flow throughout the year, use your money to make money! OR have it reinvest back into your security so the your payouts get larger every time and your account grows.

Now next time you go to do research, you can fully understand everything on a company summary! I tend to use either Yahoo! Finance as my go to source to research stocks, or Fidelity (my bank) and use their resources. Whatever firm you use to manage your money, they should have investment research tools to understand everything you need to know!

Hope you enjoyed the read, and I hope it furthered your knowledge. I know for a fact the more I talk about and do more research on what I know I learn more every time! My next post will be about a few different type of bank accounts for investing, well, the ones I think are important!

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Chris Barto