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Original, source-based guides to worked analysis examples for investors.
20 articles · Original research guides with primary sources and worked examples
Break down the causes of rising revenue and falling profit into the cost-of-sales ratio and SG&A expenses. Learn how to distinguish temporary costs from recurring deterioration in profitability.
Read article →Reconcile profit and cash through working capital, capital expenditure, and debt repayments. This case examines collectibility and the purpose of spending before treating a cash decline as financial distress.
Read article →A P/E ratio can fall when EPS grows faster than the share price. Align actual and forecast earnings bases, then calculate the estimate risk behind a lower multiple.
Read article →Calculate the distance to break-even instead of judging recovery by the percentage reduction in losses alone. A hypothetical case compares the source of profit, cash burn, and recurring costs.
Read article →A decline from a past high differs from a discount to current value. A hypothetical case with changing earnings prospects and net debt shows why a lower price does not necessarily make an investment more attractive.
Read article →Calculate nine outcomes by varying EPS and the valuation multiple instead of relying on one price target. Learn the assumptions behind the middle and extreme values and the reference points to use when calculating upside.
Read article →A simple average of segment growth rates can differ from overall revenue growth. Learn to weight growth by prior-year revenue shares and identify acquisition and currency effects separately.
Read article →Calculate earnings-per-share dilution from a new share issue with net income held constant. Learn to separate weighted-average shares for a midyear issue from the earnings contribution of the capital raised.
Read article →Calculate how the same cash outlay affects cash received by shareholders, ownership percentages, and EPS when used for dividends or buybacks. Also examine the purchase price and any subsequent resale of treasury shares.
Read article →Distinguish inventory reductions caused by production cuts, normal sales, and discount clearance. Calculate the difference between a lower carrying amount and cash recovery, and identify indicators needed to assess normalization.
Read article →Calculate additional interest expense by distinguishing floating-rate debt from fixed-rate debt maturities. This case also considers rate reset dates, refinancing, interest income, and hedging.
Read article →Calculate currency sensitivity using dollar costs as well as export revenue. A hypothetical example distinguishes operating-flow exposure from revaluation effects on foreign-currency balances at the reporting date.
Read article →Calculate incremental cash flow before dividing the initial investment by annual profit. This case shows how working capital, maintenance spending, uneven cash recovery, and discounting change the result.
Read article →Calculate break-even utilization from capacity, selling price, unit variable cost, and fixed costs. Learn why yield, inventory, and additional shift costs make reported utilization alone insufficient to establish profitability.
Read article →Calculate the interaction effect missed by simple addition when price and volume change together. Learn two ways to allocate the revenue change and the product-mix trap in average selling prices.
Read article →Passing higher costs through to customers requires different prices to preserve profit per unit and the profit margin. Unit-level calculations distinguish raw-material weights and changes in sales volume.
Read article →Calculate market-share changes by comparing company and market growth on the same basis. Also examine how value versus volume measures, market definitions, and exchange rates can change the result.
Read article →Build scenarios linking sales volumes, prices, costs, and fixed expenses instead of changing only growth rates. A worked example separates probability-weighted outcomes from the risk of a funding shortfall.
Read article →Go beyond confirming an attractive story by defining observations that could overturn it. Learn to test falling costs, customer expansion, and order-to-revenue conversion using different disclosures.
Read article →Learn which links between calculations and conclusions to retain when condensing a long report to one page. Separate reference dates, key assumptions, valuation ranges, and contrary evidence for comparison with the next earnings release.
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