Newbie in shares

[homieboy]

Hi All,

After burning my cash on subscription and so called financial advisers, I have started reading books and researching stocks.
I am trying to learn about fundamental investment strategy. The following is my strategy or strategy about the companies which I want to invest in:

- companies with market cap of around 100mill
- companies trading under pe of 8
- Directors must own significant number of shares
- Companies with low debts
- Research for companies trading at a discount

I have got number of questions:
1: Do you guys use stock screeners to screen the stock or go through each stock listed on ASX to calculate pe
eps
2: How do you predict future earnings.

Most of all what is the starting point?

Thanks in advance for any assistance you can provide.

 

[systematic]

I encourage you in your desire to be systematic in your approach.

Regarding Q2. Many would use consensus forecasts / analysts forecasts rather than estimating.
Re: Q1. For just PE, you can get that in many places - even your daily newspaper. Just be aware that different sources will have calc'd it differently.

Starting point would be to find sources you are happy to use for your data. Not sure quite what you mean.

Have you checked out morning star? They have lots of info (and a screener of sorts) that you might find useful.
You can get director data yourself, or you can get that info from subscription services etc.

My questions (just food for thought) on your criteria:
PE less than 8 - why 8? why not 7.5 or 9?
What do you mean, companies trading at a discount - to what?

i.e. work on your definitions a bit etc.
But I like that you are being methodical...