You don’t have to be a genius or an investment banking specialist to use Yahoo Finance. This financial tool is used by students, retired investors as well as professionals. It is an ideal instrument to obtain quick financial figures about a specific stock. In this article, I will provide a quick guide, so that starters know what to look at.
Let’s Search Information About Your First Stock
First of all, you need to go to finance.yahoo.com. Then, write the name or the ticker of the company you are looking for. Once you have introduced the name, the website will automatically give you several financial securities associated to the company. You usually want to select the first option given:
Source: Yahoo Finance
The next page that Yahoo will show is the stock’s summary page. The big number in black letters is the share price. If you buy one share, the price to be paid will be close to that figure. Yahoo finance also offers the date, time, and whether the market is open or close. You can also see the change in the stock price in the last trading day. If the market is about to open, you will also see the pre-market activity. On the top of the page, Yahoo Finance also offers several indexes such as the S&P 500, the Dow 30, or the NASDAQ. If those indexes are going up, the share price of your company will most likely go up. Hence, you need to understand and study those indexes:
Source: Yahoo Finance
Below the stock price, you will find trading information, valuation information, and the stock chart. In addition, you will see more links, which provide more information about the company. You can find additional sophisticated stock charts, Yahoo Finance statistics, Yahoo Finance conversations, business profile information, and other details about the company. If you want to buy shares, you will need to know everything about the company.
Source: Yahoo Finance
Trading Information
The trading information given in yahoo finance offers details about the supply and demand, price, and volume. The “previous close” is the last price of the previous trading session. The “open” is the price at which traders bought and sold shares when the market opened. The “bid price” is the price at which traders are willing to buy shares. The “ask price” is the price at which sellers want to sell stock. You can also see the change in the share price in one day and the last 52 weeks in “day’s range” and “52 week range.” Finally, there is information about “volume”, i.e. the amount of shares bought and sold in the day:
Source: Yahoo Finance
Valuation Information And Charts
Yahoo also offers information about the value of the company. The “Market Cap” is the number obtained by multiplying the total amount of shares by the share price. It represents the amount of money given by the shareholders. The “Beta (5Y Monthly)” measures how the share price moves when the stock market moves. If the share price moves a lot, you will see a large beta. Low beta means that volatility is low. The “PE” represents the price-to-earnings ratio (P/E ratio). The PE ratio is used to know whether the company is undervalued or overvalued. Higher PEs usually represent overvalued companies, and low PEs represent undervalued companies.
The “EPS (TTM)” shows the earnings per share in the last 12 months. High EPS means that the company makes a lot of earnings as compared to the share price. Companies showing low EPS ratio are usually overvalued. In the same page, you can also see information on when the company will release new earnings, i.e. “Earnings Date.” In addition, Yahoo provides details about the amount of dividend given by the company, and the next dividend date. Finally, the “1y Target Est” represents the expectations of the analysts. They believe that in a year, the share price will be close to the figure given by Yahoo:
Source: Yahoo Finance
In the summary page, you will also find a small stock chart of the day. It shows the share price at different times. You can select other charts by selecting the other options. “1D” is the chart of the day, “5D” is a 5 days stock chart, “1M” is a one month chart, and “6M” is a six months chart. “YTD” is a year to date chart. “1Y” and “5Y” are one year and five years charts. Finally, “MAX” offers the entire trading history of the company.
Source: Yahoo Finance
Become a Patron of StockMarketRevolution.com today – Visit our Patreon Page!
