How to get very good at reading financial statements?
There's a lot of free online reasons that tell you want each term on the financial statements means and whether or not the number assigned to that line item is good or bad, but are there any resource that walks you through the three financial statements and develops an investment thesis for company? Any video, article, or book would be helpful.
Reading financial statements:
Developing thesis: https://www.wallstreetoasis.com/forum/hedge-fund/on-the-job-with-simple…
Dick - not OP, but you are an absolute stud. Can’t thank you enough for all the free resources (and even in this case, simple directions to other resources)you provide.
You are welcome. And thank you.
The above threads are good references for a high level framework, but imo there is no substitute for learning via application. Go check out a Company, and try to track whatever they do through their financial statement. After some repetition, you'll start becoming familiar enough to read the story through the numbers and connect everything. I.e., Company had large buyback program. Ok, go see how that flowed through the statements and how cash was allocated in order to fund - did they lever up, pay out of cash flow, or distribute via cash? Did margins expand such that it was the bump in incremental cash flow that was allocated to buybacks? All of this stuff you can see in the numbers. Accounting is just the language of business and thinking of it as such will help you start to become more fluent when looking at numbers.
Also going to comment that there a ton of good YouTube videos where people will walk through the statements. Can be good to have the audio/visual when learning.
Thanks, any really good ones that come to mind?
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