Fundamental analysis

Key Indicators for Selecting a Company

– P/E is the ratio between the market value of a share to the company’s net profit per share. This ratio shows how much each dollar in profit will cost investors. The lower it is, the more profitable it is for an investor to buy the company’s stock.

– PEG is an indicator for characterizing growth in the P/E ratio. It can be calculated by dividing P/E by the expected earnings growth for the next year. If the value is near, but less than 1.0, this means that the company's shares are undervalued and it’s very profitable to buy them.

– P/S is the ratio of the price of one share to the sales volume in a year. The lower this indicator, the more profitable it is for an investor to buy the company's stock.

– ROE reflects the return on equity as a percentage.

– ROA is the ratio of the company's profits to its assets, i.e., its profitability.