Imagine buying a store. Before deciding how much to spend, you want to know how much money that store makes. Now imagine dividing the store into a thousand ownership pieces.

These pieces are similar to stock shares, in the sense that you are acquiring a piece of the business, rather than the whole thing. The business can pay How To Study A Company Stock for your ownership stake in several ways. It can give you a portion of the profits, which for shareholders comes in the form of a periodic dividend.

It can continue to expand the business, reinvesting money earned to increase profitability and raise the overall value of the business. Not every company pays a dividend. In fact, many fast-growing companies prefer to reinvest their cash rather How To Study A Company Stock pay a dividend. Market experts disagree about what constitutes a cheap or expensive stock. Other popular measures include the dividend yield, price-to-book and, sometimes, price-to-sales.

These are simple ratios that examine the stock price against the second figure, and these measures can also be easily found by studying stock tables.

Picking stocks is much like evaluating any business or company you might consider buying. Buzz Fark reddit LinkedIn del. Cheap stocks aren't always good stocks. Online Tools: Price Check Calculator -- Find out how much a company's stock is really worth, from SmartMoney, a magazine Zero1 Company focuses on finances.

Nasdaq Dozen -- A look at how Nasdaq evaluates stock. Email Printer Friendly.