Alpha: Risk factors not incorporated into the financial data of a company such as bankruptcy and financial disasters.

Amortization: Amortization or amortisation is the process of decreasing or accounting for an amount over a period of time.

Analysis Conclusions:

Balance Sheet: BS = Balance Sheet

CA: CA = Current Assets

Capital Asset Pricing Model (CAPM): The Capital Asset Pricing Model (CAPM) is used in finance to determine a theoretically appropriate required rate of return of an asset, if that asset is to be added to an already well-diversified portfolio, given that asset's non-diversifiable risk. The model takes into account the asset's sensitivity to non-diversifiable risk (also known as systemic risk or market risk), often represented by the quantity beta (β) in the financial industry, as well as the expected return of the market and the expected return of a theoretical risk-free asset.

Capital Expenditures: Cap Ex = Capitalization Expenditures

Cash and Cash Equivalents: The amount of money available to the company to invest into the business or distribute to investors.

CL: CL: Current Liabilities

Company Name: Name used to identify a company.

Comparable Multiples: A comparison between two financial measures used to determine the value of a target company.

Comparative Analysis:

Corporate Tax Rate:

Cost of Capital: The cost of capital is an expected return that the provider of capital plans to earn on his investment.

Cost of Goods Sold: COGS = Cost of Goods Sold

Country Analysis: Many of the techniques used in modern finance try to estimate the value of country and currency potential by predicting future value assuming the continuation of past results. WikiWealth, instead, determines the future potential of individual companies to enhance the valuation of country and currency potential. WikiWealth believes that companies with lots of potential will attract the most money internationally, and thus, increase the value of local currencies. From property rights to budget deficits, countries have a significant roll in helping domestic companies to succeed. The international flow of money determines the demand for local currencies. Therefore, currency changes are a direct representation of a number of different and complimentary attributes of a particular country. WikiWealth simply identifies those characteristics to predict future country potential.

Country Risk Premium: The premium required by an investor to place money in a foreign investment. The US country risk premium is 0%.

Current Asset: CA = Current Assets

Current Liabilities: Liabilities used within a year.

Debt: An obligation owed to a third party. Wikiwealth uses interest bearing debt, preferred equity and minority interest to determine the obligations owed to third parties before equity owners receive free cash flow in the business.

Debt Percentage of Capital: Debt as a percentage of capital (= interest-bearing debt + equity).

Debt to Equity Ratio:

Depreciation: Depreciation is a term used in accounting, economics and finance to spread the cost of an asset over the span of several years.

Depreciation and Amortization: D&A = Depreciation and Amortization

Discounted Cash Flow Analysis:

Discount Rate: The rate at which future cash flow is discounted to see the current value. There are several methods of discount rates. Wikiwealth uses the WACC, or weighted average cost of capital.

Dividend Payout Ratio: Dividend payout ratio is the fraction of net income a firm pays to its stockholders in dividends:

Dividend Yield:

Ebita: Earnings Before Interest Taxes and Amortization

EBIT Analysis:

EBITDA Analysis:

Enterprise Value: Enterprise value (EV), Total enterprise value (TEV), or Firm value (FV) is an economic measure reflecting the market value of the whole business. It is a sum of claims of all the security-holders: debtholders, preferred shareholders, minority shareholders, common equity holders, and others. Enterprise value is one of the fundamental metrics used in business valuation, financial modeling, accounting, portfolio analysis, etc.

Equity Capital: The amount of money raise form the sale of shares in the company. Computed by multiplying the stock price by the shares outstanding.

Equity Percentage of Capital: Equity as a percentage of capital (= interest-bearing debt + equity).

Equity Risk Premium: The premium over the risk free rate that equity investors require to earn before making an equity investment. Wikiwealth uses a historical rate of 5% to remain conservative. The rate used is most affected by the time period used.

Equity Value: Total value of the business after taking out the amount owed to debt holders. Wikiwealth uses a free cash flow to the firm approach in their valuations to derive the value of the entire operating entity. Interest-bearing debt is subtracted from that value to derive the value to equity holders (net present value of free cash flow).

Excess Cash: Cash in excess of what is needed to operate the business. Excess cash is not included in the business valuation, because it does not help in the production of free cash flow.

Exchange Rate: In finance, the exchange rates (also known as the foreign-exchange rate, forex rate or FX rate) between two currencies specifies how much one currency is worth in terms of the other.

Expected Return: The return an investor expects for a given amount of risk.

Experimental Mode:

Fair Value - Intrinsic Value:

Fair Value Per Share: WikiWealth does not compute a 12 month price target, because a time frame is a meaningless indicator of value and creates the illusion of superior predictive ability. We compute a fair value of a rational and conservative price for the company.

Free Cash Flow:

Free Cash Flow to the Equity (FCFE): FCFE = Free Cash Flow to Equity. In corporate finance, free cash flow (FCF) is a cash flow available for distribution among all the equity security holders of a company. FCFE is cash available to the equity holders and debt service.

Free Cash Flow to the Firm (FCFF): FCFF = Free Cash Flow to the Firm. In corporate finance, free cash flow (FCF) is a cash flow available for distribution among all the security holders of a company. They include equity holders, debt holders, preferred stock holders, convertibles holders, and so on. FCFF is before debt servicing.

Fundamental Commodity Analysis: Commodity price potential is very difficult to predict. To estimate the indirect potential of a commodity, WikiWealth uses the average investment potential of individual companies, which use the commodity in production. Some companies benefit when commodity prices increase and other companies have a negative impact from commodity price increases. The difference between the potential of these companies equals WikiWealth's Fundamental Commodity Analysis (quantitative analysis) conclusion.

Gross Domestic Product (GDP): The gross domestic product (GDP) or gross domestic income (GDI), a basic measure of a country's economic performance, is the market value of all final goods and services made within the borders of a nation in a year.

Gross Margin:

Gross Profit: Revenue minus the cost of goods sold (COGS)

Impact Analysis: Impact analysis was developed by WikiWealth to explain the positive and negative interaction between investments. The impact of certain effects within one asset class will affect many other asset classes, because the world of investments intertwined. WikiWealth's provides the tools to understand these interactions and clearly articulate their impact on each possible investment.

Income Statement: IS = Income Statement

Inflation Rate: In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time.

Inflation Rate Parity: Inflation Rate Rarity (relative purchase price parity): Inflation decreases the value of money over time; whereas, investors seek to increase the value of their money over time. The currencies of low relative inflation countries will increase in value as demand for their currency increases.

Information Ratio:

Interest-bearing Debt: Wikiwealth uses interest-bearing debt in the discount rate calculation, because this debt supplies a return to the investor, and thus, needs to be factored into a calculation of the total invested capital of the business.

Interest Rate Parity: Interest Rate Parity (International Fisher Affect): Higher interest rates draw in capital from low interest rate countries. The flow of money increases demand for the high interest rate country's currency. Higher demand creates higher-valued currencies.

Invested Capital: This is the total capital (debt plus equity) invested into a company.

Investment: Inv = Investment

Investment Flow (relative economic strength): Investment (or capital) flows is also referred to as relative economic strength forecasting: The focus is on investment flows, which follow strong economic growth trends that attract foreign investments, and thus, increase demand for the local currency.

Investment Indicators:

Investment Moats: Investment moats are general characteristics that separate great investments from average stock investments. Fundamental investors such as Warren Buffett utilizes the concepts of investment moats for their stock picking. The wider the investment moat the better, because companies can more easily defend themselves from attaches by competitors. Moats may not be able to stop competitor, but they can slow down competition and allow defending companies to think of new strategies. Examples of moats include unique technologies (see Intel) and brand names (see Coca-Cola).

Investment Questions:

Jensen Alpha: Excess return over some benchmark.

Long Term: LT = Long Term

Long Term Growth Rate: This is the rate of inflation in a conservative investment analysis. The expectation is that company revenue estimates will not surpass the inflation rate into the long term. Current US inflation expectations are 3%.

Main Street Common Sense Overview:

Margin of Safety: Margin of Safety (potential), or safety margin, is a term produced by Benjamin Graham and used by Warren Buffett to measure the degree of potential for a stock. If the margin is positive, then the stock is undervalue and the investor should buy; otherwise, the investor should sell.

Market Portfolio: A portfolio that consist of every risky asset.

Minority Interest: MI = Minority Interest

Mortgage Calculator: "Mortgage calculator are used to help a current or potential real estate owner determine how much they can afford to borrow to purchase a piece of real estate. Mortgage calculators can also be used to compare the costs or real interest rates between several different loans, determine the impact on the length of the mortgage loan of making added principal payments or bi-weekly instead of monthly payments. A mortgage calculator is an automated tool that enables the user to quickly determine the financial implications of changes in one or more variables in a mortgage financing arrangement. The major variables include loan principal balance, periodic interest rate compound interest, number of payments per year, total number of payments and the regular payment amount."

Net Operating Profit After Tax: Net Operating Profits After Taxes

Operating Expenses: Expenses related to the operation of the business. These include sales, such as marketing, general overhead expenses and administrative, or staffing expenses.

Op Ex: Op Ex = Operating Expenditures

Opportunity: External conditions that are helpful to a company. Complete the SWOT research report analysis using short-term helpful industry conditions that help benefit the company.

PFG: Enterprise Value (Price) / Free Cash Flow / Long Term Growth Rate (Ave. next 5 yrs)

POG: Enterprise Value (Price) / Operaing Cash Flow / Long Term Growth Rate (Ave. next 5 yrs)

Present Value: PV = Present Value

Present Value Factor: Mathematical factor used to find the present fair value of future cash flows. The factor is contingent on the discount rate applied to free cash flow. A higher discount rate increase the factor, which decreases the present value of cash flows.

Present Value of Free Cash Flow: The result of applying the present value factor times the free cash flow generated by the operating entity.

Price Earnings Growth PEG Ratio:

Price Earnings PE Ratio:

Price to Book Ratio: The price-to-book ratio, or P/B ratio, is a financial ratio used to compare a company's book value to its current market price (or Enterprise Value). The lower the better. A low ratio indicates that their is more value for each share of the company.

Price to Cash Flow Ratio: The price/cash flow ratio (also called price-to-cash flow ratio or P/CF), is a ratio used to compare a company's market value to its cash flow. It is calculated by dividing the company's market cap by the company's operating cash flow in the most recent fiscal year (or the most recent four fiscal quarters); or, equivalently, divide the per-share stock price by the per-share operating cash flow. In theory, the lower a stock's price/cash flow ratio is, the better value that stock is.

Purchase Price Parity: In ideally markets, identical goods should have the same price. The exchange rate should equalize the price of goods across countries. If goods differ significantly, then the low priced good can be sold in the high priced market for an immediate profit.

Ratio: A financial measure of a company. A ratio is a quantity that denotes the proportional amount or magnitude of one quantity relative to another.

Reinvestment Rate:

Required Return of Debt:

Required Return of Equity:

Retention Rate: 1 minus the dividend payout rate. This is the amount of money that a company retains within their business. That money is used to continue investments to grow the business.

Return on Asset (ROA):

Return on Equity (ROE):

Return on Invested Capital:

Revenue Analysis:

Risk Free Rate: The rate of interest with no risk. Usually, the US treasury yield curve is used as the risk free rate of interest measure for US companies. WikiWealth uses the 20 year rate for all investments, because a long-term investor should have at least a 20 year time horizon.

ROC: NOPAT / Invested Capital Value

R-squared: In statistics, the coefficient of determination, R2, is the proportion of variability in a data set that is accounted for by a statistical model.

SG and A: SG&A = Sales, Growth and Administrative

Shares Outstanding: These are the shares currently available to the public for a particular stock investment. Shares outstanding are common shares that have been authorized, issued, and purchased by investors.

Sharpe Ratio:

Short Term: ST = Short Term

Short-Term Debt: Debt expected to be payed off within a year. Wikiwealth uses only interest-bearing debt in their Free Cash Flow Valuation.

Stock Beta:

Stock Price: Indicates the cost per share of the target company. Records the changes in the value of a public company.

Stock Price Trigger: A stock price trigger is information that will drive the stock price either up or down quickly. Triggers are the most important opportunities and threats listed in the swot analysis for each individual company.

Stock Rating:

Stock Symbol:

Strategic Advantage or Disadvantage: Strategic advantage is the most fundamental and persistent advantage that the target companies possess over it's competitors over the very long term. These advantages or disadvantages are generated by the companies actions.

Strength: Internally generated long term advantage in the industry. Related to SWOT analysis, strength gives a company a long term advantage over it's rivals. Examples include: great brand name or economies of scale.

Sustainable Growth Rate: Sustainable growth rate (SGR) is the maximum rate at which a company can grow revenue without having to invest new capital. The higher the ratio, the better.

SWOT Analysis:

Systematic Variance: The part of total variance, which is explained by movements in the market portfolio.

Tax: Fees, or tariffs, charged by a regulating organization within which the business operates.

Terminal Value: TV = Terminal Value

Threat: External conditions that are harmful to a companies performance. For the Wikiwealth SWOT analysis, use short-term conditions that pose a threat to the business. Long-term / fundamental and internal conditions can go in the weakness category.

Treynor Ratio:

Unsystematic Variance: The part of total variance, which is not explained by movements in the market portfolio. The non-diversified risk of an investment.

Valuation Date: The last recorded date at which financial information was updated.

Value Investing: A type of investing where the value of a company is determined by its ability to make cash. Future cash is projected using conservative estimates of potential. Risk factors are modeled as accurate as possible and are used in a quantitative form to measure the risk of the investment. The current stock value is the discounted future cash flow potential of the target company.

Variance: In probability theory and statistics, the variance of a random variable, probability distribution, or sample is one measure of statistical dispersion, averaging the squared distance of its possible values from the expected value (mean). Whereas the mean is a way to describe the location of a distribution, the variance is a way to capture its scale or degree of being spread out. The unit of variance is the square of the unit of the original variable. The positive square root of the variance, called the standard deviation, has the same units as the original variable and can be easier to interpret for this reason.

WACC Analysis: Financial Term Description: WACC Discount Rate Analysis

WACC Discount Rate Analysis:

Wall Street Stock Research Overview:

Warren Buffett Intrinsic Value Score:

Warren Buffett Valuation Analysis:

Weakness: A long term / fundamental business concern that is internally generated. Weakness, as it relates to the SWOT analysis, is something that causes issues for the underlying business, which take considerable time and effort to fix and are internally generated or controlled.

Working Capital: Short term capital used to operate the business. An investment in working capital is the net change in working capital. Investments are needed to sustain growth in a business, but an increase in investments lowers available cash to investors and thus lowers the value of the business.