SMG STOCK RESEARCH WORKSHEET

PRESENTED BY NANCY B. KING, ALASKA SMG COORDINATOR

MODERATED BY VINCENT YOUNG, DIRECTOR OF CURRICULUM INITIATIVES

Based on

One Up On Wall Street : How To Use What You Already Know To Make Money In The Market

by Peter Lynch and John Rothchild

FUNDAMENTAL ANALYSIS

• Uses company financial data to determine health of a company

• SMG Stock Research Worksheet uses 6 pieces of financial data1. Earnings Growth Rate2. Sales Growth Rate3. Profit Margin4. PEG Ratio5. Debt-to-Equity Ratio6. Percent of Institutional ownership

Morningstar Reuters

Morningstar

COMPANY PROFILE

GROWTH RATES: EARNINGS-PER-SHARE (EPS) AND EPS

FORECAST

EPS GROWTH RATE DATA

To Find the Data on Morningstar

EARNINGS-PER-SHARE 5-YEAR GROWTH RATE

FORECAST

Analysts estimate of company’s growth rate in the next 5 years.

To Find the Data on Morningstar

SALES/REVENUE GROWTH RATE

SALES/REVENUE DATA LOCATION

To Find the Data on Morningstar

PROFIT MARGIN

PROFIT MARGIN

To Find the Data on Morningstar

COMPANY PROFIT MARGIN VS INDUSTRY AVERAGE

COMPANY NET MARGIN VS INDUSTRY AVERAGE

To Find the Data on Morningstar

PEG RATIO

PEG RATIO

To Find the Data on Morningstar

PEG GUIDELINES FOR QUALITY STOCKS

Is the stock overpriced or is it a bargain?

0.5 to 0.9 The stock is a bargain if it is a quality company. 1.0 to 1.5 The stock is reasonably priced.

2.0 to 2.5 The stock is overpriced.

DEBT RATIO

LONG-TERM DEBT-TO-EQUITY

To Find the Data on Morningstar

INSTITUTIONAL OWNERSHIP

INSTITUTIONAL OWNERSHIP

To Find the Data on Morningstar

STOCK PRICE

To Find the Data on Morningstar

STOCK’S CURRENT PRICE TREND

STOCK PRICE TRENDING UPSTOCK PRICE TRENDING DOWN

Free Stock Charts.com

MCDONALD’S PRICE TREND

To Find the Data on Morningstar

WRAP-UP QUESTIONS

THE SMG STOCK RESEARCH WORKSHEET

• Presents one way to evaluate a company

• Does not guarantee success

• Provides a systematic way to analyze a company

• Allows students to base their stock decisions on solid information

• Provides an alternative to guessing and to someone’s hot tip

RESOURCES

•Morningstar.com -- comprehensive data•Reuters.com -- good narrative about companies•Finance.yahoo.com -- I use their portfolio feature•Google.com/finance -- I like their variety•Bloomberg.com -- excellent for stock news• theMint.com -- for students• SmcKids.com -- from Warren Buffet kids tv program

INVESTING

• is a craft

• is an art, not a precise science

• requires patience, persistence, consistency

• requires objectivity, discipline, responsibility

These are listed at the conclusion of the Teacher Guide

COMMON CORE ELA ANCHORS

• Integration of Knowledge and Ideas• CCSS.ELA-Literacy.CCRA.R.7 Integrate and evaluate

content presented in diverse media and formats, including visually and quantitatively, as well as in words.– CCSS.ELA-Literacy.CCRA.R.10 Read and

comprehend complex literary and informational texts independently and proficiently.

INTEGRATION OF KNOWLEDGE AND IDEAS (GRADES 11-12)

• Science and Technical Subjects• CCSS.ELA-Literacy.RST.11-12.7 Integrate and evaluate multiple

sources of information presented in diverse formats and media (e.g., quantitative data, video, multimedia) in order to address a question or solve a problem.– CCSS.ELA-Literacy.RST.11-12.8 Evaluate the hypotheses,

data, analysis, and conclusions in a science or technical text, verifying the data when possible and corroborating or challenging conclusions with other sources of information.

– CCSS.ELA-Literacy.RST.11-12.9 Synthesize information from a range of sources (e.g., texts, experiments, simulations) into a coherent understanding of a process, phenomenon, or concept, resolving conflicting information when possible.

INTEGRATION OF KNOWLEDGE AND IDEAS (GRADES 6-10)

• Science and Technical Subjects– CCSS.ELA-Literacy.RST.6-8.7 Integrate

quantitative or technical information expressed in words in a text with a version of that information expressed visually (e.g., in a flowchart, diagram, model, graph, or table).

– CCSS.ELA-Literacy.RST.9-10.7 Translate quantitative or technical information expressed in words in a text into visual form (e.g., a table or chart) and translate information expressed visually or mathematically (e.g., in an equation) into words.

SPEAKING AND LISTENING• Presentation of Knowledge and Ideas

– CCSS.ELA-Literacy.SL.11-12.4 Present information, findings, and supporting evidence, conveying a clear and distinct perspective, such that listeners can follow the line of reasoning, alternative or opposing perspectives are addressed, and the organization, development, substance, and style are appropriate to purpose, audience, and a range of formal and informal tasks.

– CCSS.ELA-Literacy.SL.11-12.5 Make strategic use of digital media (e.g., textual, graphical, audio, visual, and interactive elements) in presentations to enhance understanding of findings, reasoning, and evidence and to add interest.

COMMON CORE MATH

• Modeling (HS Domain)• Statistics and Probability (MS)

– Using data samples to draw general conclusions and identifying patterns.

SMG SKILLS

THANK YOU

Open for Questions