Fundamental Analysis Workshop Series Session Two – Art of Reading Annual Reports

Fundamental Analysis Workshop Series

Session Two – Art of Reading Annual Reports

Where to find? Basic Decrypting

Applying the Information Q & AIntroduction

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SYLLABUS



SEMESTER 2WK 2 • Introduction to Stock Investing

WK 3 • Art of Reading Annual Reports

WK 4• Picking the Right Stocks(Part I) – Top Down Analysis

WK 5 • Picking the Right Stocks (Part II) – Bottom Up Analysis

WK 6 • Picking the Right Stocks (Part III) – Dividend Investing

RECESS WEEK

WK 7 • Portfolio Management for the Retail Investor

WK 8 • Case Study 1



WK 11 • Traders Interview

Common Issues

• Where to source out the important and relevant information?

• What do certain terms mean?



Agenda

• Where to find Annual Reports?• Understanding an Annual Report– Income Statement– Balanced Sheet– Cash Flow Statement– Statement of Retained Earnings

• Applying the information



INTRODUCTION



PROFILE

• NUS Invest Research Analyst

• Year 1 BBA

• 2 years experience

• Pure Fundamental Analysis



Where can I find Annual Reports?

Where to find? TECHNICAL ANALYSIS DOW THEORY Q & AIntroduction







Decrypting the Annual Report

Where to find? Basic Decrypting DOW THEORY Q & AIntroduction



Annual Report

• Released annually

• Snapshot of the business

• No two are the exactly same





Main Components

• Chairman’s Statement

• Business Review

• Income Statement

• Balanced Sheet

• Statement of Cash flow

• Statement of Retained Earnings



Chairman’s Statement



Business Review



Business Review

Income Statement



Balanced Sheet







Statement of Cash Flow



Statement of Retained Earnings



Applying the Information

Where to find? Basic Decryption




Ratios

• NTA• EPS• PE• ROE• Current Ratio• Debt/Equity



Mentality

• Be curious, inquisitive• Take nothing for granted• Don’t be swayed by neither optimism nor

pessimism• Make your own judgements• Stand by them

Liquidating ValueAsset Class Coefficient

(%)

Cash and cash equivalents 100

Trade and other receivables 80

Inventories 66

Financial assets, available for sale 15

Property, plant and equipment 15

Q & A



Summary

• Curiosity

• Patience

• Hardwork



THANK YOU!



Fundamental Analysis Workshop Series Session Two – Art of Reading Annual Reports

Documents

basic decryptingapplying

research analystyear

annual reportwhere

research officers

case study

relevant information

information purposes

right stockspart