4.Dividend yield
Dividend is one of the way to access the current financial situation of the company or how the top management to decide the cash flow management. For example, if company has positive cash flow, it would be able to establish a good dividend policy, such as to distribute certain percentage of the earnings to the shareholders. Investors actually can also make the investmet decision based on their needs. Some investors who are conservative maybe can invest in low growth company with strong cash flow to lower the risk of capital loss by getting return by receiving dividends. Normally a well managed company would establish a stable dividend policy.
5. Debt ratio
Debt ratio is one of the key element when I make investment decision. It is calculated by divided the total asset by total debt or long term debt. This is a way of measurement of the current financial health status of the company. With this ratio analysis, we can detect how aggresive of that company to achieve higher glowth.
6. Current ratio
Current ratio is measured by divided the current liabilities with current assets. With this ratio, we are able to tell whether can the company survive in short term. I am actually conservative investor. So this is actually a good judgement to dEtermine whether should we take the risk of investing in that company.
To be continued...
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