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What about a new board for shares/company research?

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TheMotorcycleBoy
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What about a new board for shares/company research?

#160478

Postby TheMotorcycleBoy » August 18th, 2018, 4:34 pm

As a lot of you have already gathered myself and Mel are newcomers to the world of private investment. I guess we've dived in at the deep end with what we've done so far, but anyway, we soon got to the business of trying to research what firms (i.e. share purchases) were of interest by for the most part reading and processing the financial statements of published Annual Reports, and scrounging whatever we can from the internet regards company reviews, and clips and articles concerning investment tips and methods.

As mentioned above lots of the work we've done has involved gaining an understanding of "KPI"s (key performance indicators), i.e. financial ratios. Which at first was a myriad of confusing terminology! e.g. ROCE, leverage, interest coverage, FCFF, to name a few.

And whenever we have got stuck on a given term we've asked for help here, and typically received it in spades, thank you! But we've never really been sure which LF board to post the query. Some have suggested "share ideas", others not, so perhaps there's rationale to create a new board?

So concluding what I'm talking about is an area to ask questions and discuss ideas regards analysis of companies, their shares, their current valuations etc. etc. based *mainly* on numbers and things as gleaned from the Annual Reports. So basically I'm thinking of all manner of analysis ideas, i.e. of profitability, cash flow, debt (and ability to services), valuation methods, etc., but pitched at company(s) themselves, not so much at the market-place as a whole.

What do people think?

thanks
Matt and Mel

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Re: What about a new board for shares/company research?

#160483

Postby Gengulphus » August 18th, 2018, 5:15 pm

Such a board would fit in well as a "Fundamental Analysis" board in the Investors' Roundtable, to go alongside the existing "Technical Analysis" board and with a subtitle like "Analysing companies' finances and value from their accounts".

I would certainly contribute to it from time to time (though no commitment about exactly how often!), and it would hopefully have the advantage of containing more 'lasting' material - I can easily imagine someone in say 5 or 10 years time being interested in finding a discussion of free cash flow posted now, for instance, even if its examples were rather out-of-date, but not wanting to have the job of locating them in many years of at least mostly ephemeral share ideas!

Gengulphus

TheMotorcycleBoy
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Re: What about a new board for shares/company research?

#160487

Postby TheMotorcycleBoy » August 18th, 2018, 5:52 pm

Gengulphus wrote:Such a board would fit in well as a "Fundamental Analysis" board in the Investors' Roundtable, to go alongside the existing "Technical Analysis" board and with a subtitle like "Analysing companies' finances and value from their accounts".

Yes. Although I'm wondering whether, just from a newbie's viewpoint a word from the collection "share", "equities", "stock" needs to be somehow wedged into the main title of the board. Personally, I would have gone for:

"Companies, stocks and share analysis" as the main title, but I'm in complete agreement re. your wording for the subtitle.

In other words, I just find "Fundamental Analysis" too broad, too generic, but then again, I'm probably just showing my greenness a bit here.

Gengulphus wrote:...hopefully have the advantage of containing more 'lasting' material - I can easily imagine someone in say 5 or 10 years time being interested in finding a discussion of free cash flow posted now, for instance, even if its examples were rather out-of-date, but not wanting to have the job of locating them in many years of at least mostly ephemeral share ideas!

Yes. Though, of course sometimes, well at least from our perspective, it would be good to be able to pitch both generic ratio type questions, and ones discussing a specific valuation, e.g. various attempts at finding a decent price to pay for Next (NXT) into the same board.

Matt

tjh290633
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Re: What about a new board for shares/company research?

#160507

Postby tjh290633 » August 18th, 2018, 9:52 pm

What about Fundamental Share Analysis?

TJH

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Re: What about a new board for shares/company research?

#160532

Postby Gengulphus » August 19th, 2018, 8:58 am

Melanie wrote:Yes. Though, of course sometimes, well at least from our perspective, it would be good to be able to pitch both generic ratio type questions, and ones discussing a specific valuation, e.g. various attempts at finding a decent price to pay for Next (NXT) into the same board.

On a fundamental analysis board, I would pitch that in one of two ways:

* As a "basics" thread to generically discuss a particular fundamental ratio, using Next as an example (possibly alongside others).

* As a "worked example of putting it all together" thread discussing fundamental analysis, looking at it more as whole: taking a number of fundamental ratios and trying to put together a reasonably full picture of the company's finances. Again, Next would be an example.

There's another step that comes after those, which is taking that picture and deciding how well the company fits into your strategy. But that's specific to your strategy and so I think better done on a strategy board.

Basically, I think you need to divide-and-conquer your objectives and choose your boards appropriately. If e.g. you were to try to learn about the P/TBV (Price over Tangible Book Value) ratio on the HYP Practical board, you'd run quite a risk of your thread getting diverted into a discussion of how little attention you should be paying to it, TBV being a measure of capital value and HYP strategies focussing more on sustainable and preferably growing dividend income. On the other hand, Value strategies (see viewtopic.php?f=21&t=12978 if you need an explanation of the term) focus much more on capital value, and on the TMF Value Shares board, P/TBV was sometimes referred to as the "king of the Value ratios".

So if you discuss P/TBV in the context of a particular strategy, you're likely to get a view biased by the objectives and methods of that strategy! On a fundamental analysis board, you'd still probably get such views - but at least you've got a decent chance of getting a variety of them for different types of strategy.

Gengulphus

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Re: What about a new board for shares/company research?

#160533

Postby Gengulphus » August 19th, 2018, 9:00 am

tjh290633 wrote:What about Fundamental Share Analysis?

Yes, an improvement. But possibly Fundamental Company Analysis would be even better, the financial health of a company being important both in the context of shares and corporate bonds?

Gengulphus

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Re: What about a new board for shares/company research?

#160538

Postby tjh290633 » August 19th, 2018, 10:13 am

Gengulphus wrote:
tjh290633 wrote:What about Fundamental Share Analysis?

Yes, an improvement. But possibly Fundamental Company Analysis would be even better, the financial health of a company being important both in the context of shares and corporate bonds?

Gengulphus

Agreed.

TJH

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Re: What about a new board for shares/company research?

#160540

Postby TheMotorcycleBoy » August 19th, 2018, 10:28 am

Yes, I too am in agreement with idea of "Fundamental Company Analysis", particularly if the subtitle is something similar to Geng's proposal of "Analysing companies' finances and value from their accounts".

Matt

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Re: What about a new board for shares/company research?

#160542

Postby TheMotorcycleBoy » August 19th, 2018, 10:39 am

Gengulphus wrote:Basically, I think you need to divide-and-conquer your objectives and choose your boards appropriately. If e.g. you were to try to learn about the P/TBV (Price over Tangible Book Value) ratio on the HYP Practical board, you'd run quite a risk of your thread getting diverted into a discussion of how little attention you should be paying to it, TBV being a measure of capital value and HYP strategies focussing more on sustainable and preferably growing dividend income. On the other hand, Value strategies (see viewtopic.php?f=21&t=12978 if you need an explanation of the term) focus much more on capital value, and on the TMF Value Shares board, P/TBV was sometimes referred to as the "king of the Value ratios".

So if you discuss P/TBV in the context of a particular strategy, you're likely to get a view biased by the objectives and methods of that strategy! On a fundamental analysis board, you'd still probably get such views - but at least you've got a decent chance of getting a variety of them for different types of strategy.

Thanks Geng,

However, I'm personally not greatly upset when a thread I create is diverted. I definitely don't want to rock the boat here, and I can appreciate that if the HYP boards (as an example) are created with particular purpose and guidance in mind, then OPs on those boards may well think differently.

My experience of other forums, is typically that the mods ensure that the expected etiquette is forwarded, but regarding the "current direction" in which a thread follows, that is broadly up to the contributors at the time, and if the OP wants to pull the thing back on track, then it's up to he/she to that. I just think that way a natural exchange of views, and progression of knowledge can occur without the friction of moving threads etc. But yes, that's just my opinion, and I appreciate that it may not be a view widely shared.

Matt

PS. thanks for the link to the "value strategies" thread.

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Re: What about a new board for shares/company research?

#160597

Postby Gengulphus » August 19th, 2018, 3:22 pm

Melanie wrote:However, I'm personally not greatly upset when a thread I create is diverted. I definitely don't want to rock the boat here, and I can appreciate that if the HYP boards (as an example) are created with particular purpose and guidance in mind, then OPs on those boards may well think differently.

My experience of other forums, is typically that the mods ensure that the expected etiquette is forwarded, but regarding the "current direction" in which a thread follows, that is broadly up to the contributors at the time, and if the OP wants to pull the thing back on track, then it's up to he/she to that. I just think that way a natural exchange of views, and progression of knowledge can occur without the friction of moving threads etc. But yes, that's just my opinion, and I appreciate that it may not be a view widely shared.

Just to be clear, the more important point I was making was that the responses you get might well be one-sided due to the nature of the strategies that the strategy board was about. Which is fine if those strategies are all that you're really interested in, but likely to leave you disappointed and/or with a misleading impression if you're interested in the broader picture.

And the point about the thread being diverted is that the diversion might be on-topic for the strategy board and what the OP reckons is "on track" rather off-topic. In those circumstances, trying to pull the thread back "on track" isn't likely to work all that well - in particular, it might well lead to users who gave the OP the benefit of the doubt to start with, reckoning that they wanted to know how the ratio concerned might be relevant to the strategy and weren't trying to pull the board on to other topics, was no longer leaving any doubt to be given the benefit of...

Gengulphus

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Re: What about a new board for shares/company research?

#161139

Postby melonfool » August 21st, 2018, 11:42 pm

I like the sound of this - a board for the basics.

Mel

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Re: What about a new board for shares/company research?

#161153

Postby TheMotorcycleBoy » August 22nd, 2018, 6:41 am

Well, despite having already asked a lot of "our" questions already, I feel that I still have plenty more things that I've come across whilst reading reports, and several ideas for possibly interesting ways of comparing ratios etc.

For example, I've recently found a couple of firms with what seemed to me, to be a high proportion of equity held by "non-controlling" interests. I'd like to discuss how things such as this could effect dividend payments to holders of the main company. I've been holding back from writing anything down mainly because we've nearly consumed all Mel's ISA allowance for this year with earlier years savings, and have a lot of other things to do with our time, but it would be great to have a single place to discuss topics like this.

But more importantly, perhaps other beginner investors joining the forum in the future will see this board as a more obvious place to pitch similar questions.

Matt

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Re: What about a new board for shares/company research?

#161658

Postby TheMotorcycleBoy » August 24th, 2018, 6:24 am

So what happens now?

Does the Lemon Fool's administrator/owner make a decision?

Matt

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Re: What about a new board for shares/company research?

#161684

Postby redsturgeon » August 24th, 2018, 8:55 am

Melanie wrote:So what happens now?

Does the Lemon Fool's administrator/owner make a decision?

Matt


It is being looked at.

John

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Re: What about a new board for shares/company research?

#161691

Postby melonfool » August 24th, 2018, 9:23 am

In terms of beginners - TMF used to have a board called 'Ask a Foolish Question' which was sort of for beginners. Though it wasn't specifically about shares I guess.

Mel

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Re: What about a new board for shares/company research?

#161718

Postby TheMotorcycleBoy » August 24th, 2018, 10:36 am

melonfool wrote:In terms of beginners - TMF used to have a board called 'Ask a Foolish Question' which was sort of for beginners. Though it wasn't specifically about shares I guess.

Mel

I see what you mean, Mel. But I think what I have described in this thread, is more targeted at companies themselves (and all of their securities not just their equity necessarily), analysing their reports, using ratios, figuring out what is useful/meaningful for one firm (but perhaps not others), but with the freedom to either site one firm, several firms, or maybe just the "report analysis" ratios themselves (EV/EBITDA, P/E, etc.) from a more generic perspective.

Matt

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Re: What about a new board for shares/company research?

#161728

Postby richfool » August 24th, 2018, 10:55 am

I would very much favour a board in which one could discuss stocks regardless of their suitability for a HYP. For example mid and lower yielding stocks.

Currently, the HYP Practical board seems to be the only board where individual stocks are/get discussed, and the constraints of HYP Practical are such that they must be higher yielding (HYP eligible) stocks, OR they must have previously been higher yielding HYP candidates. We need somewhere where we can discuss all stocks regardless of dividend yield. I would for example like to be able to discuss stocks like Compass or Unilever, whether they are HYP eligible or not.

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Re: What about a new board for shares/company research?

#161735

Postby melonfool » August 24th, 2018, 11:10 am

richfool wrote:I would very much favour a board in which one could discuss stocks regardless of their suitability for a HYP. For example mid and lower yielding stocks.

Currently, the HYP Practical board seems to be the only board where individual stocks are/get discussed, and the constraints of HYP Practical are such that they must be higher yielding (HYP eligible) stocks, OR they must have previously been higher yielding HYP candidates. We need somewhere where we can discuss all stocks regardless of dividend yield. I would for example like to be able to discuss stocks like Compass or Unilever, whether they are HYP eligible or not.



That board exists - Share Ideas. Or Investment Strategies. Or you could use Portfolio Review. There are also 'sector' boards where you can post about the shares in that sector.

The fact that people don't post much on other boards doesn't mean they are not there. Topics have to be initiated - HYP has some dedicated people who do that, so the board gets busy. Make another board the place where YOU dedicate yourself to starting topics.

Mel

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Re: What about a new board for shares/company research?

#161837

Postby richfool » August 24th, 2018, 3:35 pm

Melonfool wrote:That board exists - Share Ideas. Or Investment Strategies. Or you could use Portfolio Review. There are also 'sector' boards where you can post about the shares in that sector.

The fact that people don't post much on other boards doesn't mean they are not there. Topics have to be initiated - HYP has some dedicated people who do that, so the board gets busy. Make another board the place where YOU dedicate yourself to starting topics.

Yes, "Share Ideas" is a valid point. I had previously seen it more as a board for more specialised stock suggestions - e.g. small caps etc, but you are quite right, there's no reason why one shouldn't post/discuss Non-HYP FTSE 100 stocks there.

I had ruled out the Portfolio Review board, as I was thinking of single stocks. Similarly I didn't see Investment Strategies as appropriate.

I recollect on the Motley Fool boards, whilst stocks were actively discussed on the HYP Practical board, their alternative for Non-HYP stocks seemed to be their Stocks A-Z board, but on the odd occasion I posted on that, the post seemed to be "lost in hyperspace", rarely receiving a reply, or if it did, it was many weeks later, when someone happened to stumble on it..
The Lemon Fool "Share Ideas" does seem to be used a lot more.

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Re: What about a new board for shares/company research?

#161844

Postby PinkDalek » August 24th, 2018, 3:58 pm

melonfool wrote:In terms of beginners - TMF used to have a board called 'Ask a Foolish Question' which was sort of for beginners. Though it wasn't specifically about shares I guess.


There is a board entitled How Do I Invest (Investment discussion for beginners. Why you should invest your money, get help getting started) if of interest but I don't think it covers what "Matt & Mel" are after.


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