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Version 5 2019-05-23
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Reuters
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Stock Doctor Report
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Yahoo Finance
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Company's Website
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Company's Annual Report (and half yearly report between Feb - July)
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DATANOTES
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Net cashflow (if manual, get the most recent half numbers) - operating only, ignore investment, etc.
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Number of shares on issue (check ASX for latest number)
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Cash per share
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Share price
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Share Price / Cash per share
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Sentiment (Share Price Graph - 3 Point Trend Line)
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Dividend Yield
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PE (price / earnings ratio)
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Net income from continuing ops (last six months) - from Yahoo Financials
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Price / Earnings (six monthly, using net profit after tax)
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PE n-1 (last halves)
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PE n-2
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PE n-3
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PE n-4
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PE n-5
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PE n-6
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Net Equity
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n-1
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n-2
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n-3
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Net Equity per Share (NEpS)
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Price-to-Book Ratio (PB) ((Price - NEPS)/NEPS)
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Net Income (NPAT) - last six months (half yearly report)
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Earnings Per Share
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Return On Equity (earnings / equity)
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Future earnings per share
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Intrinsic Value #1 (Current EPS / 19.5% Hurdle Rate)
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Intrinsic Value #2 (Future EPS / 7.5% Hurdle Rate)
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CHECKLIST
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Is it a Star Stock on Stock doctor?
Manual method:
Use the Financial Strength table on Reuters.
Score the company (1,0) compared to the industry averages on the five metrics in this table.
PLUS:
Was the return on equity greater than 15%
Was the EPS growth greater than 10%?

Total Score out of 7.
What is it as a percentage?
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Is it A1 - B2 on Share Analysis?
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Is the share price beneath the Stock Doctor intrinsic value?

Alt: Yahoo finance consensus estimate share price. Same thing as intrinsic value.
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Is the share price beneath the Share Analysis intrinsic value?
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Is it below my intrinsic value if I use a 19.5% hurdle rate?
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Is the share price below the forecast intrinsic value using a hurdle rate of 7.5%?
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Price to Book - is the share price less than 30% above the Net Equity per share?
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Does the share price have a positive trend? A positive get a 2.
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Is it the lowest PE in the last three years?
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Growth of the Earnings per Share (as a percentage) / PE (as a number) - make the result a number - want it to be higher than 1.5
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Does the company have a consistently increasing equity?
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Is the PE less than the yield?
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Is the dividend yield higher than the mortgage rate (if you're using the investment to pay off a mortgage, eg you've mortgaged your home to raise money to invest).
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Is the financial health from the subscription services stable or increasing? (1 for stable, 2 for increasing)
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Is my forecast instrinsic value more than 2x the current share price?
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Look for the most undervalued of the top ten ASX stocks and ask is this stock one of those?
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Is the Price ps / Cash ps less than or equal to 6? Give it a 2 for a positive.
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Is the CEO an owner - founder? (Gets a 2 for a yes)
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Intrinsic value going up in the future? (Share Analysis)
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Total the Score (19)
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Divide total score / 19 (number of checklist items) - want this to be higher than 75%.
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Measure Of Value (MOV): Take checklist score, divide it by Price to Cashflow number - Greater than 0.1 it's a buy. Less than 0.1, it's not a buy.
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Allocation
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Is the company liquid? Look at the Average Daily Transaction Value.
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Multiply MOV by the average daily transaction volume for the share
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Greater than 0.1 it's a buy. Less than 0.1, it's not a buy.
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