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E-Marketing

Fundamental Analysis
Fundamental Analysis probes the Balance Sheet, the Income Statement, and the Statement of Sources and Uses of Working Capital.
The Balance Sheet is a point in time view of Assets and Liabilities and Shareholder's Equity (derived by subtracting liabilities from assets).
The Income Statement shows the results of operations including revenues, less the cost of goods sold, operating expenses, non cash charges, interest expenses, and taxes.
The Statement of Sources and Uses of Working Capital looks at the sources of funds and uses of funds. This statement is critical to look at how a company is sourcing its working capital requirements and capital expenditures.
Fundamental Analysis evaluates the Balance Sheet, Income Statement, and Sources and Uses of Working Capital in order to assess the following;
o Liquidity
o Asset Quality
o Earnings Quality
o Leverage
o Debt Service Coverage
o Profitability
o Growth
o Possible Problems and Opportunities for Improvement
Liquidity Ratios-
Current Ratio- ratio of Current Assets (assets maturing within one year of statement date) divided by Current Liabilities (liabilities maturing within one year of the statement date). Current Assets generally consist of Cash, Marketable Investments maturing within one year, Current Receivables, and Inventory. Current Liabilities consist of Accounts Payable, Current Debt, and Deferred Income.
Quick Ratio- ratio of Current Assets minus Inventory divided by Current Liabilities. This is a better measure of liquidity since the true nature of liquidity under duress is difficult to determine. Forced liquidations can lead to very disappointing realizations. A quick ratio over one is desirable.
Receivables Turnover- Sales for the Period divided by Average Receivables (Beginning Receivables minus Ending Inventories divided by two). The trend in this ratio is extremely important to determine credit quality of the customers and whether the company is meeting its...