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Value
Analysis Scorecard |
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Company____________________ |
Date__________________ |
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Step 1) Analysts’ Ratings & Forecasts Sentiment Index _____ Add one point if the Sentiment Index score is minus 4 or below. Subtract one point if the SI score is greater than 2. Earnings Growth _____ Subtract one point if the forecast year-over-year earnings growth exceeds 4% Earnings Forecast Trend _____ Subtract one point if the EPS forecasts increased two cents or more during the last 90 days. Step 2) Valuation Implied Growth _____ Add one point if the implied growth is less than 5%. Subtract one point if the implied growth exceeds 10%. Step 3) Target Price Current price vs. target buy price _____ Add one point if the current price is below the low target buy price. Subtract one point if the current price exceeds the high target buy price Step 4) Industry Analysis Industry Growth _____ Add one point if the industry sales growth rate exceeds 15% Subtract one point if the industry growth rate is less than 3% Industry Concentration _____ Add one point if the industry has less than four major competitors Step 5) Business Plan Business Plan Score _____ Record business plan score
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Step 6) Management Quality Key Executive & Board Quality _____ Add one point if you rated the Key Executive & Board Quality very good or excellent Clean Accounting/EPS Growth Stability _____ Subtract one point if the non-recurring charges percentage of sales averaged 3% or more over the past five years, or if you judged the earnings growth stability as poor. Stock Ownership (not included in score) Step 7) Financial Health Financial health is a pass or fail test. Disqualify candidates that fail the appropriate test. Step 8) Profitability Normalized Return on Assets _____ Normalized return on assets is the ROA that you expect the firm to achieve in its recovery year. Add one point if the normalized ROA exceeds 14%. Subtract one point if the normalized ROA is less than 6% Step 9) Red Flags Historical Capital Exp. vs. Depreciation _____ Subtract one point if recent annual deprecation charges generally exceeded capital expenditures in the same year. Step 10) Ownership Total Insider Ownership _____ Subtract one point if insider ownership exceeds 55% of shares outstanding Step 11) Price Chart Share Price vs. Moving Average _____ Subtract one point if the share price is more than 10% above its 200-day MA
Total Score _____ |