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Monitor's Monthly Report on Individual Stocks

Monitor's Monthly Report on Individual Stocks

Helpful Hints: Monthly Report

Most information needed for the monthly report comes directly from Value Line and your SSG for your company.

Heading Material: To find the date on which the fiscal year ends, look at the last date listed in the quarterly information (lower left corner) in Value Line. The fiscal year will not necessarily match the calendar year. The date of the most current Value Line is located on the bottom right side immediately above the footnotes.

1. Take information for number of shares and cost per share from your club's Valuation Statement

2. Get the current price from listings in newspapers or online. To get the price online, go to the Quicken website (http://quicken.excite.com/investments/quotes) at the end of the trading day. Type in the ticker of your stock and click Go. The current price is labeled "last trade."

To calculate the percent change of anything over time, subtract the prior value from the most recent value and divide by the prior value. For example, a stock valued at $50 last month and at $60 this month has gained 20% [60 (recent value) - 50 (prior value) = 10 / 50 (prior value) or .2].

3. The online page that you called up to get the closing price in question 2 will also list the fifty-two week high and low prices.

4. Zoning figures come from your most recent SSG in Section 4C.

5. The Quicken website page will also give you the current PE. Last month's PE comes from your prior monthly report. Information on the PE in the industry comes from the Industry Page in Value Line. It is located in the box at the lower left side of the Industry Page.

PE shows the relationship of price (P) and earnings (E). To calculate, divide the price by the earnings per share. Roughly, the PE indicates the number of years that it will take for an investor to recoup through earnings the price paid for an investment. For example, a PE of 10 indicates that it will take 10 years for earnings to cover the price paid for the stock. A PE of 10 also means that an investor is willing to pay $10 for every $1.00 of earnings.

6. You can hand calculate relative value or take it from the Stock Selection Guide, section 4. Relative Value is the relationship between the current PE (or closing PE) and the historical PE (shown on page 2 of the Stock Selection Guide under Section 3). For example, a stock with a historical PE of 10 and a current PE of 15 has a relative value of 150% (15/10 = 1.50). A relative value of 100% indicates that the current PE is identical to the historical PE. A relative value of 80% means that the current PE is 20% below the historical PE. Use the relative value to help decide if the stock is overpriced. The recommended range for relative value is 90-110%. If it is lower or higher, try to find out why. If it is lower, it might have fallen for a very good reason. If it is higher, the stock may be overheating.