Questions tagged [stock-analysis]

For questions related to the analysis of stock prices, stock markets, etc.

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1answer
428 views

Free cash flow and capex on morningstar.com

When looking at for example Netflix’s cash flow statements here http://financials.morningstar.com/cash-flow/cf.html?t=NFLX&region=usa&culture=en-US&ownerCountry=USA, there is a big ...
4
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1answer
6k views

Chart total return of mutual fund vs. stock with dividends reinvested? [closed]

Using common charting software, how can I best compare total returns of a mutual fund vs. total return of a stock, with dividend reinvestment (DRIP) in each case? Frequently the easy to get charts ...
2
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2answers
1k views

Do marketmakers always quote a bid and ask simultaneously

I am trying to understand some MM (Market Maker) data that I have. As a follow up to a question I read about MM: How does a dealer (or market maker) earn the bid-ask spread on a stock? And to ...
2
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2answers
2k views

Why does a small number of bid/ask quotes not cause stock price to fluctuate drastically?

Often times I find that the number of bid and ask quotes presented for a stock are quite small in number. For example, just today I was watching a stock whose bid and ask prices looked very similar to ...
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5answers
18k views

If I have $1000 to invest in penny stocks online, should I diversify risk and invest in many of them or should I invest in just in one?

I have $1000 to invest. I use Scottrade to invest in penny stocks online, they charge $7 to buy a stock and another $7 to sell it ($14 in total). Given the high volatility of these stocks, what tactic ...
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1answer
89 views

Judge market efficiency from raw price action

Is it possible to judge just by tape reading and analyzing the price action, if a particular security in a particular market is efficient or not? I often read commentaries by experts that state that ...
2
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1answer
177 views

How do stock analysts estimate the earnings for a publicly traded company? What about costs?

I assume that if one was a careful study of a company, you could determine revenue by surveying consumers and determining how much inventory is being sold, but I don't see how an analyst could gain ...
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1answer
534 views

What happened to Houston American Energy Corp. (HUSA) that made their stock crash?

I noticed this HUSA stock. And seen that they were steadily over the $10 line for most of 2010-2011 and at the beginning of 2012 they started going down. Yahoo Finance shows that they were upgraded ...
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1answer
100 views

Can I calculate stock value with Williams%R if I know the last set?

I've got a random stock. Yesterday the value was $76.25, where as the Williams %R was -72.72. Is it possible by only knowing this, to calculate the value if the Williams %R rises to -20?
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3answers
1k views

Equation to determine if a stock is oversold and by how much?

Given a stock, is there any mathematical equation than can determine if that stock is oversold? I will use the equation against all stocks in the market to generate a sorted list of oversold stocks.
2
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1answer
242 views

Why do P/E ratios for a particular industry tend to cluster around particular values?

The answer I've read on this topic is that a new industry with a lot of growth potential (software, biotech, etc.) tends to have the stock priced at a premium in order to reflect the growth 'potential'...
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1answer
142 views

Do individual investors use Google to obtain stock quotes?

In relation to my empirical research I am interested in the following questions (regarding the US). 1) How widespread is the use of Google when invidual/private investors wants to find information on ...
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4answers
7k views

Online stock screener to find stocks that are negatively correlated to another stock/index? [closed]

Is there a free online resource that I can use to find pairs of stocks that are always negatively correlated? For example, I want to find stocks that are negatively correlated w.r.t SPY. On Google ...
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2answers
48k views

Will a company's stock price be affected when warrants are issued, or exercised?

A company has 500 million outstanding shares, and it issued 100 million warrants 10 years ago. Assume that none of the warrants has been exercised yet. If tomorrow all the holders exercised their ...
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3answers
17k views

If a company's assets are worth more than its market cap, can one say the shares must be undervalued?

Imagine a company sold a 10% stake in one of its assets to a 3rd party for $100 million. It would be fair to assume that the asset is worth $1 billion. If that company had 200 million shares issued, ...
4
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1answer
286 views

Can I get a dumbed down explanation of risk measures used for evaluating stocks?

Hoping this will be a good reference question for the site. Can someone explain in a way that doesn't require a lot of math/statistics background what the following terms mean when analyzing the ...
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2answers
365 views

Would long-term treasury bonds (e.g. TLT) generally rise when stocks (e.g. SPX) fall?

Is this a correct analysis of TLT (iShares 20+ Year Treasury Bond): It was hammered by QE talk in May. It will continue to generally drift lower while QE is in effect or even being tapered and the ...
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4answers
29k views

Why does a stock price drop as soon an I purchase several thousand shares at market price?

I have at times bought thousands of shares of a stock but every time it seems the share price dips right after my purchase. Is this just bad luck or part of the process?
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1answer
5k views

Can one see the transactions in the stock market?

Is it possible to see the individual transactions in a certain exchange market (e.g. NYSE) for a certain stock (e.g. GOOG)?
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2answers
2k views

Is Investments by Bodie just an expanded version of Essentials of Investments?

I'm looking to start learning about hardcore securities analysis and I see a couple MBA courses that use Essentials of Investments or Investments both by Bodie, Kane, and Marcus. Investments is about ...
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2answers
169 views

How can I estimate the standard deviation

How can I estimate the standard deviation from stock graph without calculates, just from the graph
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0answers
94 views

Forward Contract Extension

I was reading this article Below is a small snippet from the article. I'm wondering how Barrick gold could extend the hedge at its own option. How would this be executed and how do they have this ...
2
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2answers
8k views

How do I calculate the quarterly returns of a stock index?

I was reading an article and it stated something along the lines of (not accurate figures): Quarter | Stock Index % Change In Quarter Sep 2011 | 5.21 Dec 2011 | 4.69 Mar 2012 | 3.20 June 2012 | -...
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1answer
18k views

Calculating a stock's price target

In the book 'Insider Buy Superstocks', he seems to be calculating price targets like this: [last quarter EPS] x 4 x PE = price target Does that look correct? Is he basing PE off the current stock ...
2
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1answer
12k views

Why can low volume move a stock price drastically?

Over the summer on days with very low volume, there were substantial movement in the stock markets. Why is this? Is it because there aren't enough market forces in check to really give a correct ...
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3answers
21k views

What does the average log-return value of a stock mean?

Assuming log-return is defined by the log of the price today divided by the price yesterday. Does knowing this single piece of information (the average log-return of a stock over a long period of ...
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2answers
291 views

Looking at Options Liquidity: what makes some stocks so attractive for options traders?

I've noticed that options volumes can vary dramatically between underlying securities. What makes some stocks (e.g. AAPL, BAC) so attractive for options traders?
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1answer
154 views

Do retail traders get any advantage from learning methods of mathematical of finance?

There are many mathematical tools that are used in analyzing the stock market, including things like path integrals and statistical mechanics . Does the application of these tools in financial ...
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2answers
3k views

What does “/” and “^” mean in ticker symbols? How to translate these symbols into yahoo?

I have downloaded a complete list of all NYSE stock symbols from the NASDAQ website here. As it turns out, many of these symbols are not recognized by the yahoo finance page. In particular, there ...
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2answers
277 views

Incorporating real-world parameters into simulated(paper) trading

A bit expanding the question asked here, I want to try and test a strategy using a simulated(paper) trading. As a first step, I have tried to find any brokers who provide a convenient simulated ...
2
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1answer
499 views

Periodicity in stock charts

Not sure if this is the right forum for this kind of question, but here goes: I have been looking at a 3.5 year time series of several hundred DJIA stocks and notice that for many (but not all) ...
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1answer
379 views

Bids and asks in case of market order

Suppose that person A places buy market order with quantity 1000 of firm XYZ. Now in the market there only are various asks of quantity: quantity 100, quantity 2000, quantity 1000. Each ask has ...
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3answers
1k views

Rate of change of beta

While viewing data for an individual stock, I always want to see how much the beta has changed. I see this useful for three reasons: Trends (up, down, or stable) in the beta The 60-month beta hides ...
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1answer
18k views

Is there a difference between a company's profit vs earnings?

I am reading through a company's annual report trying to do research on whether I should invest in them. I'm new at all this and it's got a lot of complicated terms which I'm unsure about. One thing ...
4
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1answer
2k views

Calculating historic S&P 500 returns

I'm using the S&P 500 data provided by Robert Shiller which goes back to 1871. I've then calculated the percent return for each month, the simple arithmetic average is 0.43%. Calculating the ...
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1answer
266 views

Why does heavy volume indicate the strength of a trend?

When a reversal occurs on a chart on a heavy volume, it is supposed to signal the beginning of a strong reverse trend. For example, if a security was trending upwards and then it moves down on heavy ...
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1answer
1k views

Gauge the strength of the resistance level of a stock just using EMA

Say I calculate the 200-day EMA of a stock to be $25. The stock currently trades at $22. I see from the historical price action that it has touched $25 and failed to break it two times in the past 4 ...
4
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3answers
1k views

Why would analysts recommend buying companies with negative net income?

Can anyone explain why some analysts recommend companies in the biopharmacy sector as a "buy" even though they have high R&D costs and no real profit? I followed three companies and I see the ...
5
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3answers
566 views

Benjamin Graham: Minimum Size of the company

In the book "Intelligent Investor", Graham recommends a minimum annual sales figure of 100 Million $ as one of the criteria. How do we adjust this figure for Inflation and a country other than the ...
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2answers
332 views

Where does the stock go in a collapse?

During the crash at the end of 2008, pretty much everyone was selling their stock and the market tumbled approximately 50%. Who purchased the stock? Was it market makers or other people? I understand ...
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2answers
178 views

Why don't institutions share stock recommendations like Wall Street analysts?

The article Track Institutional Buying, Not Analysts states that: Mutual funds, insurance companies, pension funds and other institutional investors rely on their own research. Contrary to ...
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4answers
2k views

Does doing your “research”/“homework” on stocks make any sense?

One thing about investing has always bothered me. You constantly hear people saying you need to "do your research" or "do your homework" on a company before buying their stock. I rarely watch Mad ...
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2answers
3k views

In a quote-driven market, how do market makers figure out bid/ask prices and bid/ask sizes?

I understand that bid/ask prices and bid/ask sizes are ultimately determined by the market maker. I am curious about some general principles that the market maker follows when determining the above ...
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1answer
4k views

Why bid and ask do not match the price at which the stock is being traded [duplicate]

For a particular stock, the stats look something like this: Price: 54.55 $ Bid: 54.54 $ Ask: 54.55 $ Now if I place a market order, will it get executed at the Price (54.55 $)? My guess is yes. Now ...
2
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3answers
2k views

Why liquidity implies tight spread and low slippage

At this link: http://www.investopedia.com/articles/trading/06/daytradingretail.asp they mention: Liquidity allows you to enter and exit a stock at a good price (i.e. tight spreads and low ...
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1answer
16k views

What time period is used by yahoo finance to calculate beta

On the stock page in yahoo finance, there is specified a beta value for the stock. Now is there a way to know what time period was used to calculate the beta? Is it the trailing 12 months? Does yahoo ...
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3answers
2k views

Why do moving average acts as support and resistance?

What is the reason that a particular moving average can act as a good indicator of support and resistance for a particular stock? Moving average is just an avg of closing prices over 30 days or 50 ...
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2answers
4k views

Calculating Profit Ratio (Gross Margin)

When looking at a company's income statement to calculate the Profit Ratio (Gross Margin) PM = Net Profit / Sales Do you include "other" revenue in the equation? Example: XYZ Ltd Income Statement ...
2
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1answer
454 views

Is there a step-by-step procedure to find a security's intrinsic value?

Recently I was reading about different fundamental analysis approaches, and specifically about Value Investing, as proposed by Ben Graham and David Dodd. This approach describes a strategy which based ...
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1answer
3k views

How to calculate average drawdown of a trading system?

Let's say that I'm trying to evaluate a FX trading system. I know how to calculate the largest drawdown during a period of time, but how can I calculate the average drawdown or the average largest ...

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