  Provides information on what a company does, its financial performance, as well as its plans for the future  Companies with more than $10 Million in assets whose stocks are held by more than 500 owners are required to file annual and other periodic reports Annual Report

    Company website home page Getting a Company’s Annual Report

  The money collected for providing a product or service Revenue

  Total earnings after all expenses have been paid Net Income

  What remains after subtracting a company’s costs from its revenue. Profit is a company’s reward for taking a risk and successfully producing what people want to buy at prices they are willing to pay. Profit

  People buy to make a future profit  People buy to save for retirement Why People Buy

  People sell to collect their profits, or protect against further loss because the stock price is dropping Why Sell

  People hold because historical trends suggest that over the long-term, stocks have the greatest return Why Hold

  Make an educated decision  Look at the annual reports for the company How do you know the right action to take?

  It is extremely important to research other companies in the same industry  Check the revenue and profits from your companies and compare them to other firms in the same industry  If the other companies are doing much better, you would tend to sell.  If they are doing worse, you would tend to hold Sector Analysis

  Check current events surrounding companies  Check how the sector is performing  This is important because if a sector is growing, you may still want to purchase the stock despite the poor performance of other companies  If the sector is collapsing, you may want to sell even if your stock is outperforming More Research

  A stock price is an indication of what investors believe a company is worth  Stock price not only reflects a company’s value, it also reflects the investor’s expectations of future growth and earnings Stock Price

  A number of factors contribute to the minute-to- minute changes in a stock’s price  Market forces such as supply and demand  If more people buy a stock than sell it, then the price goes up  If more people sell than buy, the price goes down Price Influence

  News events together with public opinion play a role in creating rises and dips in stock prices  Reports on internal corporate activity, industry trends, and national/international events are interpreted as either good or bad news by the public, who in turn determine whether a company is a good investment or not Price Influence

  Projected earnings of a company  Public companies report their earnings four times a year (once each quarter)  Wall Street carefully watches earnings results  Analysts base their opinions about future value of a company on its earnings projections Other Data That Influences Stock Prices

  If a company’s earnings report is better than analysts expected, the stock price rises  If a company’s results are worse, stock price falls