A stock analysis report informs readers about the stock's performance. This information helps readers decide whether they should invest in the stock at hand, and when. To write your report, you must have a thorough understanding of the stock you're profiling as well as extensive knowledge of how the stock market functions.
1. Write your introduction, which must provide a brief profile of the company. In this profile, state the products the company sells, the company's location and its annual profits, says Jeffrey C. Hooke in "Security Analysis on Wall Street." Specify the company's earnings in the most recent year and quarter as well as a summary of how its earnings have changed over time. Finally, sum up your recommendation for whether investors should purchase or avoid the stock.
2. Describe the company's life cycle stage in your next paragraph, Hooke suggests. In "The 10 Stages of Corporate Life Cycles," organizational performance expert Ichak Adizes outlines 10 life stages that companies may experience, which range from the courtship (planning) and infancy stages to the bureaucracy and death stages, where innovation declines and the company may eventually crumble. Companies typically experience a rapid growth phase early on (the go-go phase), then may experience internal conflicts in their adolescence phase before entering their prime, when they balance growth with discipline, says Adizes,
3. Continue your second paragraph by summing up the company's earning trends from the past three to five years, says Hooke. Then predict how the company will continue to perform financially based on this record. At the end of the paragraph, present your rationale for the recommendation you made at the end of the introduction.
4. Write a third paragraph explaining how the market may affect the performance of the stock you're analyzing. Specify the times of the year when investors should consider buying the stock, and the times when they should avoid it, based on typical market cycles and events that may influence the stock's performance in the given year.
5. Ensure your tone is jargon-free yet professional. Remember that your audience consists of intelligent adults who may already have experience investing, but who may not know the lingo of the field.
- Stock Analysis on Wall Street; Jeffrey C. Hooke
- Inc.: The Ten Stages of Corporate Life Cycles
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