RATIO ANALYSIS:
FINDING THE DATA
Before we delve into the different
ratios and how they work, let's briefly discuss where you can find the data for
each ratio.
The first step in ratio analysis is
to find the data. For the 19 ratios we will be taking you through we will be using
a fictitious company, Cory's Tequila Co. All the data for these examples will
be provided, but when you decide to do this on your own there are several
different areas where you can find the latest financial figures for a particular
company. Finding financial reports is easier than ever thanks to the Internet,
here are some sources:
Company Websites - Almost every
public company has a website or investor relations department. For the most
current quarterly or annual report you might want to check in these places
first. Walt Disney is an excellent example of a company that uses the web to
get information out to shareholders and prospective investors. It takes no time
at all to find their investor relations section.
Securities and Exchange Commission
(SEC) - The information posted in the electronic gathering, analysis and
retrieval.
(EDGAR) database includes the annual
report (known as the 10-K), quarterly report (10-Q), and a myriad of other forms that contain every
type of financial data.
Yahoo! Finance - A touchstone for
many individual investors, Yahoo! Finance is a great resource for financial
news, and lays out ratios and performance data for individual companies.
Hoovers.com - A great site for
company analysis; some of the data requires a subscription.
These are by no means the only
places to find the financial statements, there are countless free and pay sites
out there offering similar features. Now let's move onto the meat of this
tutorial: the ratios.
(to be contd)
No comments:
Post a Comment