What is fundamental analysis in the stock market and what are its methods?

Fundamental analysis in the stock market is a method of evaluating a company’s intrinsic value by examining its financial and economic fundamentals. This can include analyzing a company’s financial statements, as well as factors such as its management, industry trends, and economic conditions. The goal of fundamental analysis is to determine a company’s true value, so that an investor can make informed decisions about buying or selling its stock. There are several methods used in fundamental analysis, including:
Financial statement analysis: This involves looking at a company’s balance sheet, income statement, and cash flow statement to gain insight into its financial health. This can include analyzing metrics such as revenue growth, profit margins, and return on equity.
Ratio analysis: This method involves calculating financial ratios, such as the price-to-earnings (P/E) ratio, to gain insight into a company’s financial performance. This can include analyzing metrics such as liquidity, solvency, and profitability.
Industry analysis: This method involves analyzing the broader industry in which a company operates, including factors such as industry growth rates, trends, and competitors.
Economic analysis: This method involves analyzing the overall economic conditions, including factors such as interest rates, inflation, and gross domestic product (GDP) growth.
Management analysis: This method involves evaluating the management team of a company and its past performance, as well as its ability to execute its strategy and create value for shareholders.
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