How to Read Financial Statements to Understand Business (Basic Analysis for Beginners)

    Many have requested a continuation of our series of articles on fundamental analysis. In this video, we start by learning how to understand companies based on their financial statements. This will let you know which issuers are worth buying later.

    I've written a number of articles about such analysis here under the disclosure triangle. I have fixed everything to see the links and important information. If you like, you can subscribe to the following videos. Don't forget to like and share the video. Don't get into numbers and metrics first. Because before you go there, you first need to know what your company's business model is.

How to Read Financial Statements to Understand Business

(Basic Analysis for Beginners)

    This is important. Because it tells you first what conditions might be favorable or unfavorable to the company you invest in, such as when reading prices. Interest rates go up when cooking oil prices go down on soybean rockets and sbi, so you'll know what happens to the stock price of the company you buy second. If you don't understand the company you're trying to acquire, you can get stuck with the metrics. Sometimes I look for a direct route, buy a Fight stock, for example, or look at metrics like PR and his PBV to quickly determine if the stock is undervalued. Instead, using this method, you'll find that there are actually a lot of cheap stocks that could keep going down in price until they're stopped.

    The danger is, first, that you don't understand why you can't, and third, that understanding the many business models of different companies will give you more knowledge about the industry, and the industry will strengthen your watchlist. and make it easier to grow. Portfolio, which sectors are weak and which industries are interesting. This is useful not only for fundamental analysis, but also for technical analysis Three sources of information I like to read to understand the company first, from the company's financial report and annual report. I want to know the company's business model You don't need to look at the 3 monthly financial reports, but the annual report available from the Indonesia Stock Exchange or IDX listed website or this latest report is enough. Website idx.co.id Now go to the Listed Company menu, select Financial & Annual Reports, and select Financial Statements.

    Then just enter the stock number or issuer, but if you want to get it directly from the company's website. Each brokerage firm or broker has reviews or reviews of our securities and already has people whose job it is to analyze the company and talk to management, the results of which are open to clients.

    It's really good for us to discover new companies we didn't know about before. It's magic that he can go to the stock analysis page and read it here.To really know a company, first he needs to know three things: the business model. At this stage, Dita doesn't need to go too deep. Therefore, for capital business, we need to know where this company is located. that money. Income, costs and profits from which activities, then divide the income and profits to examine the composition of the product or company segment. For example, we already know the income from the activity. Each has its own profit margins and its performance can be affected by a variety of factors, not just chickens and their chickens, but at least which products or segments within the company and which segments are the biggest contributors. need to know if We need to know the factors that affect the issuer's sales and profits and, finally, the company's performance and earnings.

    These are sometimes called key drivers and can be very unique or different for each issuer. For example, there are companies whose performance depends heavily on the price of cooking oil, and on whether the mall is open.

    These factors are very important in analyzing the company's performance and future potential. Start practicing identifying companies using annual reports and analyst meeting materials. This is necessary in order to reason about the future profit formula. Remember that income minus costs or expenses is the same as profit.

    When expenses are greater than income, this is also called profit or profit. This means that the number is negative, which is called loss. Let's update it with an example. For example, there is a fried chicken penier company, so it is income from chicken penier sales, raw material costs, employee salaries, and other expenses.

    If greater human beings purchase the bird penyet or the promoting fee bird is multiplied and income also can boom if the promoting fee is the equal however charges are reduced, as an instance while the fee of uncooked substances is going down, don't forget this good judgment Okay, let's visit practice, we begin with the aid of using saving the closing annual file and the closing control percentage, right here I use the agency instance the map with the emit code it is dead, so consider if we do not know some thing approximately the agency again, let's attempt to analyze. For instance, to die, perhaps I understand that is a agency that has Starbucks and Burger King in Indonesia due to the fact I used to apply map vouchers to shop for it and I suppose I've sold footwear too use a voucher map to apprehend greater deeply, first we ought to examine this MD phase or control dialogue and evaluation withinside the annual file and additionally examine the closing public cloth or investor assembly cloth and agency presentation from analyzing all of that we right away understand that OK, this loss of life does preserve a few famous manufacturers and their earnings is received from promoting those branded merchandise. If we cross again to the monetary good judgment of sophistication 7 and 11, it method that the earnings from promoting branded merchandise and the charges from salaries and store condominium expenses will boom, the earnings will boom.

    We now understand the business model that as we buy more and more and the load increases, for example the rent increases, the second step is sufficient. You can divide the profits for department stores, specialty stores, full, average, etc. We then found that over 70% of the largest was from the specialty store segment. A lot can be immediately learned from this data. For example, even if the food division is upset, it will not have a significant impact on the overall performance of the company.

    Let's try another example. Consider a scenario with a different composition of products and segments. For example, Sido appears to be reading the annual report and management presentation. 30% comes from food and beverages, the last segment and products. You should look for factors that can affect mapi performance. It turns out in the annual report and investor meeting that there is also covid and bpkm that can be inferred from there. Of course, it depends on whether people shop at other companies' malls.For example, at Sido, one of the things management mentioned is community anime. If so, it becomes our job to analyze whether the child driver mentioned is correct or vice versa.

    Tot, this business model is the official seller of major overseas brands, the largest income is from specialty stores, the main factors affecting the performance of mapi, especially in shopping malls, where many people shop whether or not Let's do it again together, let's analyze that a company is a company I don't know at all.

    We are going to select this stock, the issuer of Avia. I have no idea what company it is, but from what I've read here it looks like it's doing well with revenue growth near 8%. I went directly to Google and entered the publisher's name to find the official website. From here, I'm looking for the IR menu here. Download the two most recent annual report documents in this menu and the latest presentation materials here, open the annual report and read the Management Discussion and Analysis section until you are ready. Continue reading our investor presentation.

    First, I'm looking for a business model that can be seen from the business report that this company sells chat. Then by product and segment, here we are. You can see if the product can be divided into his two areas of building solutions and commodities. Architectural solutions are chat and other coating chemicals, commodities sell assistive devices such as brushes and rollers, and this chat product contributes nearly 90% to the enterprise. It's just too strange that a company's performance depends on the demand for its chat products. Demand for chat products seems to continue to grow. At first we thought the price of oil would be the key factor, as the majority of our commodities are oil, but we found that despite previous oil price increases, our profit margins had not changed much. rice field.

    The company was able to increase the price of its paints without losing customers. That's all. I learned the first step of fundamental analysis of a company. Then analyze whether the company is worth investing in. First, check if the reason is due to growth or wait, then look at the repeated performance data collected over the last 10 years by product and Q-driver. Later, you can also check the numbers and ratios explained in the following video.

    Start investing with a price of 100 shares and you can create a magical account with your own code. 100 hands are randomly won from Finance. Anyone who can invite 3 friends to register still has her 150,000 extra hand. I will put the link below, thanks

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