This is what I picked up from Buffettology .
It's quite a good checklist to go thru' and I'm confident of my picks as I've gone thru' the company in a systematic way.
Qualitative Analysis
1) Does the company have any identifiable consumer monopoly or brand-name products, or does it produce or sell a commodity product?
2) Do you understand how it works? (REALLY..Understand)
3) Is the company conservatively financed?
4) Are the earnings of the company strong - with an upward trend?
5) Does the company allocate capital only to business within its realm of experise?
6) Has the company been buying back its shares?
7) Does mgmt's investment of retained earnings appear to have increased per share earnings and therfore shareholder value
8) Is the company's return on equity above average?
9) Does the company show a consistently high return on total capital invested
10) Is the company free to adjust prices to inflation (pricing power)
11) Are large capital expenditures required to constantly update the company's plant and equipment
Quantitative Analysis
1) Is the Company's stock price suffering from a market panic, a business recession, or an individual calamity that is CURABLE?
2) What is the inital rate of return on the investment and how does it compare to the return on U.S Treasury bonds (or whatever govt bond your shares are based in)?
3) What is the company's projected annual compounding return as an equity/bond
4) What is the projected annual compounding return using the historical annual per share earnings growth. (Remember to weed out outlier)
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