Putting It Together

Reading a company as a whole.

No single number tells the story. Real analysis combines valuation (is the price fair?), quality (is the business good?), and safety (is the balance sheet sound?). Each ratio checks a corner, and they keep each other honest. Is it fairly priced? P/E, P/B, PEG, compared within the sector. Is it a good business? ROE, ROA, margins, over several years. Is it financially safe? Debt-to-equity, interest coverage, operating cash flow. Is it growing? Rising revenue, EPS, consistent quarterly results. A cheap P/E means little if debt is high and cash flow weak. Strong ROE means little if the price is sky-high. Read the numbers together.

Part of Learn NEPSE Investing, a free course on reading Nepali company accounts and charts. Section: Valuation.