1) Read a Balance Sheet:
2) Understand the fundamentals about the company’s business to value its shares
3) Learn to use Earnings, Revenues, Cash flow, Equity, dividend yield and subscribers to figure out how much a company is worth.
4) Return on Equity stands as a crucial weapon in the investor’s arsenal if understood properly.
5) ROE encompasses 3 main levers by which management pokes and prods the corporation – profitability, asset management and financial leverage.