finding undervalued stocks poised to explode n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Finding Undervalued Stocks Poised to Explode PowerPoint Presentation
Download Presentation
Finding Undervalued Stocks Poised to Explode

Loading in 2 Seconds...

play fullscreen
1 / 4

Finding Undervalued Stocks Poised to Explode - PowerPoint PPT Presentation


  • 2 Views
  • Uploaded on

We all would love to get in at the bottom floor of a wonderful upcoming business ready to ride the profit elevator up to new heights.\nWhere do the best opportunities lie in finding those best-of-breed businesses ready to take off in the markets?\n

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Finding Undervalued Stocks Poised to Explode' - paradigmcapitalmanagement


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
finding undervalued stocks poised to explode

Finding Undervalued Stocks

Poised to Explode

We all would love to get in at the bottom floor of a wonderful upcoming

business ready to ride the profit elevator up to new heights.

Where do the best opportunities lie in finding those best-of-breed

businesses ready to take off in the markets?

Having a simple set of criteria to help guide you in your decision-making

process is critical to consistently picking those winners.

Here are the top 6 criteria discussed by the experts at Paradigm Capital

Management for you to consider for finding those undervalued stocks

poised to take off:

1. Company size:

Look for small to mid-cap companies with a market capitalization

between $250 million and $1 billion. These emerging companies have

the greatest potential for upside growth in terms of market exposure and

profitability. The Apple's, Google's and Wal-Mart's of tomorrow all

started with humble beginnings.

2. Stability:

Look for companies that have a low Beta ratio of less than 1.0. Beta is a

measure of the sensitivity of the company's returns compared to market

returns. In theory, a stock whose returns vary less than the market's

returns has a beta with a value less than

returns has a Beta with a value less than 1.0, thereby being less volatile

and potentially risky.

3. Solid Fundamentals:

Look for companies that show growth rates in excess of 10% per year

consistently over at least a 5-year period for the following:

ROIC - return on investment capital

BVPS - book value per share or equity

EPS - earnings per share

Sales

Free Cash Flow

The key is to identify those businesses that have consistent year-over-

year growth rates. The major stock market websites that post company

financials will have the raw data that you need in order to calculate the

growth rates. For a simple Excel spreadsheet that will convert the raw

data into meaningful growth rates, please visit Stock Investing

Simplified.

4. Value:

Look for a PEG ratio that is less than 1.0. A lower ratio is better (cheaper

& healthier stock) than a higher ratio (more expensive). PEG is

calculated by dividing the P/E ratio by the earnings per share (EPS) in

order to better compare companies with different growth rates.

5. Global Exposure:

find out if the business in question earns most

Find out if the business in question earns most of, or a large percentage

of, its income from international markets. With America no longer being

the most important economic market for businesses in today's global

economy, finding a company with international exposure to its products

and/ or services is critical.

6. Stock Value vs. Stock Price:

Look for businesses where Mr. Market has priced the stock below the fair

market value of the business. Ideally, you are looking for a stock price

that has a big margin of safety (MOS) price of 30 -50% below its fair

market or intrinsic value price.

Several subscription websites provide fair value estimates for businesses.

However, should you like a simple approach to help you assess the MOS

price for a business, please check out the articles on best-of-breed

analysis at Stock Investing Simplified.

Once you have used the 6 criteria outlined above to identify potential

companies, place them on your personal watch list.

Now it's time to get up close and personal and to only invest in those

businesses that you understand and that you would be willing to monitor

on a weekly basis for any changes to the fundamentals, market forces or

competition.

This simple, step-by-step approach to analyzing stocks should help you

identify those emerging companies with the potential of rising to new

heights.

further you can check out our small cap stocks

Further you can check out our small cap stocks at Paradigm Capital

Management Inc.

Paradigm Capital is a privately held trusted leader in small cap investing

in Albany, NY and employs a disciplined, bottom-up approach with an

emphasis on fundamental analysis and extensive management contact.

To learn more, please visit here: http://paradigmcapital.com/