HOW TO GET THE BEST OUT OF HENATES

At the start of this blog, Henates stated clearly that you won't be advised to buy or sell any particular equity or stock, instead will be provided with information to decide for yourself.
In spite of this many page viewers still ask if Henates can advice on stocks and shares to buy or sell.
Henates would rather not but here's how to get the bast out of Henates analysis of company results.
At the stock market, stockbrokers quote prices for shares based on their perception of the company's fortunes and the supply and demand.
You can stay in step with them by having your own perception of the fortunes of companies you are interested in.This is where Henates analysis of released results come in handy.
Now, many form their perception from quick studies especially glances at some quick reference ratios.
For example, a company earnings per share shows how much a company made as profit attributable to each issued share. It is from this dividend is recommended by directors.
Another quick reference ratio is dividend yield which compares the dividend paid with the cost paid for the share by the investor.
Now, Henates does not give pride of place to these quick reference ratios because it is always better to understand how the attributable profit or loss was made and so be in a position to use such knowledge to project forward at least to the immediate future.
It is difficult to make money if available market is shrinking, hence revenue or gross earnings growth matters.
Then even if the market exists, making profit depends on  cost pressures within the period particularly pressures to do with direct costs incurred while producing the product or service and overheads within the control of management.
Lastly, even if market exists, and cost pressures are within control, it is also tough staying in business when there is no cash to operate with. This is why liquidity position as indicated by working capital trend comes in handy.
These are the things Henates tries to highlight and it is now left for each reader to link them to his own expectations as an investor and also compare with any other company of choice.
At this stage Henates can offer only one concession: If you want any particular quoted company in Nigeria to be analysed, leave your request in the section for comments. Henates will try to oblige soonest.

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