Great, Sarim! Let’s start your journey with a simple and clear guide on how to research stocks as a beginner.
🕵️♂️ How to Research Stocks
(Beginner’s Guide)
📍 Step 1: Understand the
Company_Explain
Ask
yourself:
- What does the company do?
- Is it something you
understand? (Like phones, food, clothes, etc.)
- Do people need their
products or services?
📝 Example: Apple sells iPhones, iPads, and
services. People love and use them every day.
📍 Step 2: Look at Revenue and
Profit_Explain
You
want companies that:
- Make money (revenue 💰)
- Keep some of that money
(profit ✅)
🔍 Where to find it:
- Google: Type “Apple stock financials”
- Or visit: Yahoo Finance, Google Finance, Morningstar
Look
for:
- 📈 Revenue growth:
Is it increasing every year?
- 💵 Net income: Is it
profitable?
📍 Step 3: Check Debt and
Balance
Avoid
companies with too much debt.
📊 Key numbers:
- Debt-to-Equity Ratio: Should be low (below
1.0 is safer)
- Cash on hand: Does the company have
cash?
📍 Step 4: Look at Stock Chart
(Trend)
See
how the stock performed over time.
🕰️ Check:
- Last 1 year
- Last 5 years
Ask:
- Is the price going up
steadily?
- Did it crash recently?
Why?
Use:
📍
Google Finance or Yahoo Finance charts
📍 Step 5: Compare with
Competitors
Example:
If you're checking Coca-Cola (KO), also look at Pepsi (PEP).
📌 Ask:
- Which company is growing
faster?
- Who makes more profit?
- Who pays better
dividends?
📍 Step 6: Read News and Analyst
Opinions
Stay
updated:
- What are experts saying?
- Any recent news (good or
bad)?
- Are they launching new
products?
Use:
- Google News
- Yahoo Finance “News” tab
📍 Step 7: Use the “5-Minute Checklist”
✅
I understand the business
✅
It makes money and grows
✅
It has low debt
✅
Stock chart looks healthy
✅
I’ve checked competitors
✅
I read the latest news
If
all these are true ➜
it's a stock worth considering.
Would you like me to show you how to apply this checklist to a real company like Apple (AAPL) or Tesla (TSLA)?