Skip to Content
Fundamental analysis
Fundamental analysis provides investors with the means to understand how a company is performing and how it might perform in the future.

Three key measures used in fundamental analysis

Earnings per share

Earnings per share is the proportion of a company's profit allocated to each outstanding share. Earnings per share can be an indicator of a company's profitability.

Dividend yield

Dividend yield indicates how much a company pays out in dividends each year relative to its current share price. It can help you compare the yield with other similar companies or investment opportunities.

Debt ratio

Debt ratio can be used to indicate how much of a company’s assets are financed by debt.

Pros

  • Allows investors to understand key information before making a decision.
  • Investors can look at the contributing factors to assess a company for current and future value and growth.

Cons

  • Fundamental analysis does not take into consideration qualitative metrics.
  • Understanding complex company data can be time consuming.
     

Things to consider

Qualitative factors – also known as the “human judgement” component of fundamental analysis – also form a key part of the process.

Other factors to keep in mind when researching a company include:

  • The business model of the company
  • Management expertise
  • Competitive advantage
  • Industry growth and structure
  • Market share

Next steps Fundamental analysis and nabtrade

nabtrade provides a powerful set of tools, data and research recommendations to help investors conduct fundamental analysis research. Visit Platform & Tools to find out more.

Investors can use reports to understand what research providers think of a particular company, how they came to that view and various other data points. You can find research reports on each security page.