If you own stock in a corporation and only look at the annual reports, you're committing investment sin #1. Don't buy something you don't understand. Learn how to break down a cash flow statement and the statement of earnings. Balance sheets are important, just remember they are a moment in time statement. Not a summary.
I concur with comment number one, learn how to compare statements with their closest competition. All the ratios are meaningless without a basis of comparison.
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Submitted by the weakonomist on March 22, 2008 - 08:19.
If you own stock in a corporation and only look at the annual reports, you're committing investment sin #1. Don't buy something you don't understand. Learn how to break down a cash flow statement and the statement of earnings. Balance sheets are important, just remember they are a moment in time statement. Not a summary.
I concur with comment number one, learn how to compare statements with their closest competition. All the ratios are meaningless without a basis of comparison.