Fundamental analysis is a tool used to find out a business's performance, such as the business's assets, owed payments, and earnings. Fundamental analysis also looks at the economy and other factors, like the business's competitors, interest rates, ownership, and employment. Fundamental analysis can be done on both old and new data, but the goal of fundamental analysis is to make future predictions about the company.
There are several objectives for fundamental analysis, such as to estimate a company's current stock price, predict future stock price, or evaluate the company's management.
There are two main methods that investors can use when using analysis to find what stock to buy and at what price to buy it at.
Investors can use one or more of these methods to find stocks to invest in. For example, many fundamental investors use technical analysis to find when to buy or sell. Many technical investors also use fundamental analysis to find "good" companies to put money into.
The investor's belief of how the stock market works normally determines which analysis strategy they choose to use.