Succinct Summation of Week’s Events 5.17.19 (plus 16 financial ratios)

Below please find the usual weekly summation, the positives being the progress in resolving the trade war, the negatives being the progress still wanting in the trade war.  The bonus this Sunday night is #19 of the Top 40 best articles from the AAII Journal, this one right up the alley of all you techies, being the 16 financial ratios for analyzing a company's strengths and weaknesses.  Hope everyone had a great weekend. 

Succinct Summation of Week’s Events 5.17.19

May 17, 2019 4:00pm by Barry Ritholtz

Succinct Summations for the week ending May 17th, 2019

Positives:

1. Market mostly recovered from Tariff postering, as US & China avoid full-scale Trade war;
2. Auto tariffs on the EU and Japan were postponed for six months;
3. Housing starts rose 5.7% m/o/m from 1.168M to 1.235M.
4. Jobless claims fell 16k w/o/w from 228k to 212k.
5. E-commerce retail sales rose 3.6% m/o/m, above the previous increase of 2.0%. .
6. Consumer sentiment came in at 102.4 for May, above the expected 97.5.
7. Housing market index rose 3 points in May from 63 to 66

Negatives:

1. Trade deal can kicked down the road; hopes for progress remain muted.
2. Home mortgage apps fell 1.0% w/o/w after previous increase of 4.0%.
3. Retail sales fell 0.2% m/o/m, missing the expected 0.2% increase.
4. Industrial production fell 0.5% m/o/m, down from previous increase of 0.2%.
5. Import and export prices each rose 0.2% m/o/m, missing the expected increases of 0.7% and 0.5% respectively.
6. Same store sales rose 5.4% w/o/w, decelerating from previous increase of 5.9%.
7. Index of leading indicators rose 0.2% m/o/m, below the expected increase of 0.3%.  

TOP40: Article 19

16 Financial Ratios for Analyzing a Company’s Strengths and Weaknesses It’s been nearly 17 years since I was awarded the Chartered Financial Analyst (CFA) designation by the CFA Institute. This grueling three-part examination process covers all aspects of financial analysis, management and planning. For one year, a lot of emphasis was placed on financial ratios, specifically the DuPont method of breaking down return on equity (ROE) into its component parts. Ratios provide a common means for comparing the financial strength and performance of companies. By analyzing ratios over time, they also reveal trends about business conditions and profitability. In my own personal experience, ratio analysis is an excellent way to develop a clear picture of a company’s attractiveness as an investment. The article 16 Financial Ratios for Analyzing a Company’s Strengths and Weaknesses is the continuation of AAII’s financial statement analysis series that originally ran in the AAII Journal in 2012. The article covers the most commonly used financial ratios, breaking them down into four categories: Activity ratios for measuring how efficiently a company uses its assets Liquidity ratios that measure a firm’s ability (or lack thereof) to meet its short-term obligations Solvency ratios that measure a firm’s ability to meet its long-term obligations Profitability ratios that measure a firm’s ability to earn an adequate return on its own investments and those of outside investors, such as yourself Ratio analysis links the three financial statements together. However, they also normalize the data to make it comparable between companies as well as allow us to identify financial trends for a company. The article 16 Financial Ratios for Analyzing a Company’s Strengths and Weaknesses outlines the most commonly used ratios to help you develop a feel for a company’s attractiveness based on its competitive position, financial strength and profitability. Stay tuned: Tomorrow I highlight an AAII Journal article by Jeremy Siegel from 1998 that revisited the buy-and-hold favorites from the Nifty 50 stock list of the 1970s.           Read the full article now —     16 Financial Ratios for Analyzing a Company’s Strengths and Weaknesses