Stock Market Investment Advice and Guidance

When you purchase shares you are buying part-ownership in a business. StockVal guides you beyond the share price to discover the real value of the business you are investing in. 

To accurately estimate the value of a business, and therefore the level below which an acceptable entry price exists, you need to understand how much equity is required to produce the reported profit. While earnings might be growing, it may simply be because you’re putting more money in. If a company is retaining profits rather than paying dividends, or is raising capital from shareholders, earnings had better be going up.

Increasing earnings is nothing special. You receive earnings, in the form of interest, from a bank account. You can achieve higher earnings by putting more money into the account. It’s the same in a company. If you put more in, at a minimum, you should be getting more out. The key therefore is not profit, but profitability.

It is very common to watch small businesses with very good economics grow into large businesses with mediocre economics. Eventually the share price will reflect the economic performance.

StockVal identifies the companies to avoid, as well as those that are attractive.

StockVal uses a mathematical formula to estimate the value of these companies. The valuation estimate is based on balance sheet equity, the return the company can sustainably generate from that equity, and the manner in which it reinvests and distributes it earnings.

With StockVal you can now simultaneously identify wonderful businesses that are also a bargain.