How to Value Stocks?
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. Source: http://www.fool.com/investing/beginning/how-to-value-stocks.aspx?source=iibedicl20000001