How to Analyze an Income Statement Like a Hedge Fund Analyst

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  • Опубліковано 23 січ 2025

КОМЕНТАРІ • 347

  • @InvestorCenter
    @InvestorCenter  3 роки тому +34

    If you are interested in downloading the spreadsheets I used to analyze stocks, you can download them here: www.patreon.com/user?u=38414104

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      @ehvio the second and third tier

    • @user-ph1ui9jg6d
      @user-ph1ui9jg6d 3 роки тому

      Hiya - this was very insightful. Do I need to sign up to Investor Center to access your spreadsheets. Furthermore, can you please make a video about how to determine growth percentage when forecasting metrics such as revenue or costs?

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      @@user-ph1ui9jg6d yes. I’m going to post all of my spreadsheets that accompany my videos to the patreon. In terms of the growth rates, I’m working on a video for that!

    • @user-ph1ui9jg6d
      @user-ph1ui9jg6d 3 роки тому +1

      @@InvestorCenter Thanks so much for your response. is there any other way of staying in touch for example: linkedin or instagram or is youtube the best way?

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      @Thor that’s the next video I’m releasing. Watch it on Monday :)

  • @joealtamuro
    @joealtamuro 3 роки тому +289

    You mentioned early in the video that you didn’t know why companies would close their books in September instead of December. It’s usually due to “seasonality”, when sales are at their lowest in the year coming off of the summer months. Therefore Net Working Capital [NWC (= Inventories + Receivables - Payables
    +/- Net Accruals)] should be at its lowest in September. Don’t forget Apple usually releases new products in the 4th quarter so inventory levels should be at their lowest at the end of September. By Closing the books when NWC is at its lowest, Capital employed will also be at its lowest. This will maximize ROCE. Also, it’s just best to close in the quarter with the slowest activity so as not to distract the company from the busy holiday season. Most retailers also operate in this fashion.

    • @InvestorCenter
      @InvestorCenter  3 роки тому +45

      Wow! That is very interesting. And it makes sense that most of the companies I see with a September year end are retailers

    • @indranilsinha4899
      @indranilsinha4899 3 роки тому +5

      wow ..great insight ! thanks a ton ! How about Microsoft it closes in Jun ??

    • @joealtamuro
      @joealtamuro 3 роки тому +10

      @@InvestorCenter Thank you and I just want to say that your videos are excellent!

    • @BradDietz
      @BradDietz 3 роки тому +5

      Most retailers (not Apple) end their FY at end of January. Very few end in December because there is too much Y/Y noise due to calendar shifts. This is also where you squeeze in a 53rd week every 6-7 years.

    • @gauravthadanii
      @gauravthadanii Рік тому +1

      can you explain in a little more detail, how the capital employed would be at the lowest at sept?

  • @samman5395
    @samman5395 3 роки тому +30

    Your videos like this are so much better than anything else on UA-cam. Please make videos about how to analyze the cash flow statement and balance sheet please!

    • @InvestorCenter
      @InvestorCenter  3 роки тому +1

      Thank you, I really appreciate the kind words!

    • @peteryusufov7589
      @peteryusufov7589 3 роки тому

      Yes, please do make the videos you mentioned in the end of this one!

  • @kakivincent7941
    @kakivincent7941 Рік тому +19

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      @Bobby-xs5gw Рік тому +7

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      @katherinajohan3319 Рік тому +5

      It's really profiting I started with 30k dollars trading with a professional broker my colleague recommended to me to Mr Sam Deymon, and now I earn more than my monthly paycheck.

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      @andrewryan1223 Рік тому +4

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    • @henrynathan2343
      @henrynathan2343 Рік тому +4

      Impressive. What's the secret? Short stocks?

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      @konradcasper2929 Рік тому +2

      @gayanaehsan8158 Damn, imagine investing in bitcoin since 2018... You could have been a multi millionaire presently.

  • @althe
    @althe Рік тому +2

    Gotta say, your videos and explanations and graphics and topic choices are way superior to everything else (in this genre) on UA-cam.

  • @jamieamato560
    @jamieamato560 Рік тому +4

    I'm only halfway through the video and I just have to say your explanations are by far the best I have heard so far. I've been researching how to analyse companies for investment for months, it's been slow progress. Although I was familiar with most of the terms you were speaking about, my understanding of them just trippled thanks to your breakdown of each of them. Thankyou so much I will now prioritize this chanel first, amazing video 😄

  • @Chartmaster2099
    @Chartmaster2099 3 роки тому +26

    Great, great presentation, I really enjoyed the way you showed how to make a discounted cash flow model in a simple and objective way.
    I'm studying valuation, but it's really hard to find practical content online, it would be awesome to see a whole series on how to make a proper valuation of a stock and how to read all the three key financial statements (Balance sheets, Cash flow and Income Statement) and how to use the financial ratios (PE, Price to book... ) with a detailed breakdown of each one.

  • @ftnavy123
    @ftnavy123 3 роки тому +4

    This is one of the best videos I've ever watched on income statements and really filled a lot of gaps I had in my knowledge of why I should care about different items. I would LOVE to see you do a DCF video.

  • @Nic-xr1og
    @Nic-xr1og 4 місяці тому +2

    For anyone reading later on- some companies don’t align to calendar year if they follow set 4-5 week periods for better comparison to other periods. This is common in manufacturing. I’m sure there are other reasons as well.

  • @Shazam_575
    @Shazam_575 3 роки тому +10

    I'm currently doing my CA(SA) articles at Deloitte and just finished writing my CFA level 2 exam and I'm honestly so impressed with this video. I did a 4 year degree specializing in finance with accounting and can confirm that this video explains everything in the SOCI (Newish name for Income Statement as per IFRS) so clearly and concisely. You definitely got a new subscriber!

  • @jclopez99
    @jclopez99 3 роки тому +5

    Excellent series of videos. And, yes! Please do a DCF Valuation video. This would be very insightful.

  • @malikdey-nativemoor2923
    @malikdey-nativemoor2923 2 роки тому +1

    Discounted Cash Flow Evaluation would be so helpful if we were explained in detail. What an amazing channel. Just found this channel looking for how buffet calculates intrinsic value and what a library of information, I stumbled across.
    Thank You! Investor Center, for delivering amazing Content and great VALUE!

  • @gt3rsm3plz83
    @gt3rsm3plz83 3 роки тому +1

    Thank you for making this. You have a great narrating voice. Very easy to understand.

  • @PeakperformerEmil
    @PeakperformerEmil Рік тому

    I have a comment for 6:00 - 7:00: The margins of the products and services are actually really important and I personally have never payed attention to them. From now on I will. They are so important because you can see what position you want the company to be scaling. Therefore it would have been nice if you did show how to calculate it. For those who dind't understand, it goes like this: (Service revenue - Cost of service)/Service revenue = Service gross margine.
    And further down the line, comapnies can't scale their Gross Margines for ever, that's why you actually can't expect them to be scaling and scaling and scaling, because it's unlikely going to happen. But they defenitely should keep at least a stable Gross margine which is somewhat high. At least that's my point of view.
    Great video, I love it.
    Lovely greetings from germany

  • @meshari.alswainie
    @meshari.alswainie 3 роки тому +1

    Many thanks to your professional analysis- Meshari from Saudi Arabia

  • @profit_paradox
    @profit_paradox Рік тому +5

    Would love to see a video that covers the projections for DCF valuation which is ultimately used to determine if a stock is undervalued!! Very helpful

  • @luxurylife7464
    @luxurylife7464 Рік тому +2

    Your videos are wonderfully put together. I would greatly appreciate if you do a DCF model video in the future. You explain things with great ease and would be helpful to understand your view point on discounting cash flows. Thank you and keep up the great work!

  • @BSI_Inc.
    @BSI_Inc. 3 роки тому +26

    Thanks so much for this video. I hope you also teach us how to analyse balance sheets and cash flow statements and the financial model too coz I personally am still unclear about that

    • @InvestorCenter
      @InvestorCenter  3 роки тому +9

      I’m working on those videos now! Thanks for the comment, Allen

    • @BSI_Inc.
      @BSI_Inc. 3 роки тому

      @@InvestorCenter looking forward to it!😁✌🏾

  • @MI-kn3id
    @MI-kn3id 3 роки тому +4

    Love the idea behind this video and how you kept it simple. Can you go over projections in a separate video we’re you give a few examples /repetitive so it will the process”sinks in” and we can better apply it to different companies/modules. Thank you.

  • @ADITYASHARMA-xp3sv
    @ADITYASHARMA-xp3sv 3 роки тому

    i came looking at bill ackman's photo(possible click bait) but boy oh boy the content - spot on. Great job

  • @erickgomez8758
    @erickgomez8758 Рік тому

    Would love to see the DCF valuation video!!!! You break things down perfectly and thank you for taking the time and effort of creating these presentations.

  • @mariecamero
    @mariecamero Рік тому

    I'm a beginner and slowly trying to learn how to analyze financial statements. You mentioned the basic financial model you created and yes please cover it in another video. If there is already, I apologize and I will watch it after this video.

  • @magdalena2115
    @magdalena2115 Місяць тому

    wow their operating income in 2021 is insane yoy. jumping from 57 to 94 BB is nuts! and their expenses weren't much different compared to previous COGS and operating expensese relaative to revenue.
    What a a great year for them

  • @michaelflynn1617
    @michaelflynn1617 Рік тому

    Please do make a DCF video. All of your explanations have been so very helpful and DCF video would really put it all together ❤

  • @amossenkao385
    @amossenkao385 3 роки тому +2

    Thanks for the great explanation. Can't wait for the ones of balance sheet and cash flow!

  • @rosalieroku3818
    @rosalieroku3818 3 роки тому +2

    Excellent presentation. I understand this better now.
    Yes, more on your spreadsheet please.

  • @jwia007
    @jwia007 3 роки тому +1

    Please teach us more. This is awesome

  • @John414
    @John414 Рік тому

    Terrific video on how to analyze the important information ℹ️

  • @andredantu6664
    @andredantu6664 Рік тому +1

    Hi, @investorcentre just watched this video and wanted to say thank you. It was an excellent overview of an income statement. I have not seen your videos before, but I have subscribed now. Thank you.

  • @matthines4507
    @matthines4507 3 роки тому +4

    Great video, I am very interested in how you set up the income statement for predicting the future performance of the company. I would love a video on how you set that up and as you mentioned deriving the cash flows from that. Thanks

  • @GregKealey
    @GregKealey 3 роки тому +3

    This is quickly becoming my favourite channel :)

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      Hey Gregory! That is great to hear. Appreciate the support!

  • @Toys4Life
    @Toys4Life 3 роки тому

    I needed this - thank you!

  • @lorenvillaverde2564
    @lorenvillaverde2564 3 роки тому

    I commend the video for comprehensively presenting the idea that Accounting students learn in Financial Analysis!

  • @eFFecTM
    @eFFecTM 3 роки тому +9

    Great video! I came across your channel today and started watching many of your videos while taking notes. I love how detailed you explain things still while trying to keep the overall video compact. I would be very interested to see a video from you on discounted cash flow valuation. Also, happy new year!

    • @eFFecTM
      @eFFecTM 3 роки тому

      Oh wait, you have made a video on this topic before in September.

    • @InvestorCenter
      @InvestorCenter  3 роки тому +3

      Happy new year! I will do a more detailed video on discounted cash flow valuation!

  • @WDWysong
    @WDWysong Рік тому

    Wow...outstanding, clear explanation...very helpful. Thank you.

  • @sev7ncapitall
    @sev7ncapitall 3 роки тому +1

    Fantastic video! I love how clearly and thoroughly you present information. You may want to look into teaching, consulting, or creating a course.

  • @izaactorres5741
    @izaactorres5741 3 роки тому +1

    Definitely want to see you breaking down discounted cash flow

  • @aroaris843
    @aroaris843 3 роки тому

    Great and simple. While others try to make difficult to understand content yours was very fluid and amazing !

  • @anandpatel2624
    @anandpatel2624 2 роки тому +1

    This is a great explanation and one very important. Thank you so much. Could you please do one for the DCF?

  • @NattSiroj
    @NattSiroj 3 роки тому +3

    Great explanation
    Would love to see additional video on DCF valuation. Cheers

    • @meheh002
      @meheh002 3 роки тому +1

      I'm bumping this up!

  • @isidorocn7982
    @isidorocn7982 3 роки тому +1

    This video has been super useful, thanks! And it would be great if you could do another video on estimating future earnings from the income statement. Thanks!

  • @lukeallen282
    @lukeallen282 2 роки тому +1

    Thank you for your video! Please also prepare a video on discounted cash flow analysis to determine if the stock is undervalued.

    • @InvestorCenter
      @InvestorCenter  2 роки тому +1

      Hey Luke, thanks for the kind words! I will be coming out with that video!

    • @lukeallen282
      @lukeallen282 2 роки тому

      @@InvestorCenter looking forward to it!

  • @ИльяЛыков-о2ш
    @ИльяЛыков-о2ш 3 роки тому +4

    Thank you very much for your job! It`s super useful and very very interesting, can`t wair for your nex video about financial models!😀

    • @InvestorCenter
      @InvestorCenter  3 роки тому +1

      Thank you for watching! Stay tuned for that video :)

  • @InvestorPro7
    @InvestorPro7 3 роки тому +3

    This video is a complete guide and I really liked it. There is always something to learn in your videos.

  • @monnombre6547
    @monnombre6547 3 роки тому +6

    thank you! you do a very great job simplifying the terminology & explaining...what about a "how to analyze" cash flow statement & balance sheet ?

  • @TT-mg3yu
    @TT-mg3yu 2 роки тому +1

    Not everyone can teach like this. Hats off mam.

  • @georgewyatt2924
    @georgewyatt2924 3 роки тому

    Very good job of explaining these items. Thank you.

  • @chrischoi4484
    @chrischoi4484 3 роки тому

    Really clear and well made video. I look forward to your future content!

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      Thank you, Chris! I look forward to your future comments on future content!

  • @TheKerth
    @TheKerth 3 роки тому +4

    The reason why some companies report its financial statements not on the year end it is because they report their FS when the company is on slack season which means movement of assets are very slow, in which the management believe it would capture or would be more representative of the company financial position

  • @trentonbillie7
    @trentonbillie7 2 роки тому +1

    Thanks for the vids… learning a lot!!

  • @JedWunderli
    @JedWunderli 2 роки тому

    Love your channel. I'd love to see the video that you talked about doing at the end of this one. I think that would be very useful. Thanks for your time and effort.

  • @danbuild977
    @danbuild977 3 роки тому

    Just what I needed. Thank you so much for this video.

  • @Internetjim1235
    @Internetjim1235 3 роки тому +1

    Really good presentation- keep them coming

  • @jaysant6958
    @jaysant6958 Рік тому

    Where is operating margin at 8:38? Why did it disappear?
    Also, Gross Margin is shown as an amount when zoomed out & not a percentage which was not explained.

  • @eRaZerrOfficial
    @eRaZerrOfficial 2 роки тому +1

    Would be awesome if you could do a "How to analyze a 10k". Great work, really

  • @lonniehardy3985
    @lonniehardy3985 3 роки тому +5

    The different fiscal year end dates are caused by the company's adoption of four periods per year consisting of 13 weeks each. Notice each of the four periods end on a saturday. This method causes each of your quarterly reports to contain the same number of weeks (13) and each of your fiscal years to contain exactly 52 weeks. It makes accounting a little more complex but yields exact comparability. Sometimes an accountants nightmare, but worth it in the long run.

  • @davidwestenburg9165
    @davidwestenburg9165 Рік тому

    Geat stuff so far!

  • @annasillanpaa1111
    @annasillanpaa1111 Рік тому

    The calendar year reporting relates to when the company was established, otherwise the first reporting would be for 6 months and 21 days or what ever which would be difficult to compare to the next ones.

  • @livingingreenvillenc6904
    @livingingreenvillenc6904 5 місяців тому

    This was great! Thank you for sharing this

  • @aggariba
    @aggariba Рік тому

    love the way you explain, thanks

  • @alejandrovarona1309
    @alejandrovarona1309 3 роки тому

    Congratulations, you do an excelent work. Please do the discounted cash flow video valuation.
    I am eager to see it!

  • @Honch79
    @Honch79 3 роки тому

    So well explained, thank you - keep making the videos 🙏

  • @1013eden
    @1013eden 3 роки тому

    Great video we need more contentl ike this and please do a video on projection

  • @justducky8508
    @justducky8508 3 роки тому

    Yes please make a separate video discussing under valued stocks

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    @ramsondave6915 2 роки тому +54

    Mrs sonia is legit and her method works like magic I keep on earning every single week with her new strategy

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      @joellefletcher6180 2 роки тому

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      @joellefletcher6180 2 роки тому

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      @raymondcash8816 2 роки тому

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      @marrysalah1398 2 роки тому

      Who's this professional everyone is talking about I always see her post on top comment on every UA-cam video I watched

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      @marrysalah1398 2 роки тому

      I think I'm interested how can I get in touch with Mrs Sonia

  • @awababd-arrahman3104
    @awababd-arrahman3104 Рік тому

    Thanks, lot for your deep work. Can you tell me "For how long should I analyze these statements"? last 4 quarters or last 10 years

  • @shubhamtailang2184
    @shubhamtailang2184 3 роки тому

    That was a wonderful explanation in laymen language. If you can explain DCF in detail and simple language that will be great. Thanks

  • @onceuq
    @onceuq 10 місяців тому +1

    Excellent content! Thank you for your wisdom, and soothing voice.

  • @minipwn0422
    @minipwn0422 3 роки тому

    I work in corporate accounting for a publicly traded firm and we have our fiscal year end in October because we would struggle to get everything done with the holiday calendar in December and January

  • @thefrugallifehacker1225
    @thefrugallifehacker1225 3 роки тому +12

    I would be very interested in viewing how you complete the DCF model for stock analysis. Where do you pull your data from.

    • @Rarealt
      @Rarealt 3 роки тому +2

      Bloomberg for foundational framework & then pull data from other providers as well.

    • @mpsanish
      @mpsanish 3 роки тому +2

      You’ll need to also make some solid assumptions and forecast. Be sure to look at how the market factors and bake them into ur assumptions.

    • @mda0214
      @mda0214 Рік тому

      Lol don't listen to the comments posted. This is like a crash course. There's a lot more information you can get from a companies financials. I would recommend taking an online class in accounting at a college. Its a couple thousand max. But you'll make it back fast.

  • @Khurram-zp8gl
    @Khurram-zp8gl 4 місяці тому

    Thanks a lot.pls also cover some topic to estimate intrinsic value of the company.

  • @kevinpascall299
    @kevinpascall299 3 роки тому +2

    So clear and very easy to digest. Thank you sooooo very much. - from a non-Accounting, budding investor.

    • @InvestorCenter
      @InvestorCenter  3 роки тому +1

      Glad it was helpful! I enjoy being able to help :)

  • @julienthefirst9151
    @julienthefirst9151 3 роки тому

    You have a beautiful voice! And good content too :)

  • @domceja62
    @domceja62 3 роки тому

    Great video! Very clear and concise!

  • @timvanandel237
    @timvanandel237 3 роки тому +1

    Anything on cash flows? Investment generally tends to look at that metric more so than income

  • @davidschroeder3580
    @davidschroeder3580 3 роки тому +1

    very informative and like the way you broke it down

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      Thank you, David! Glad you found the video informative

  • @emmanuelgoutonde8216
    @emmanuelgoutonde8216 3 роки тому

    Very useful video, Thanks for your hard work!

  • @aishwaryakochar3334
    @aishwaryakochar3334 2 роки тому

    Totally amazing. You kept the information and time both concise and useful. Could you also upload the DCF video which you mentioned?

  • @olaafolabi6015
    @olaafolabi6015 3 роки тому +1

    I enjoyed your video, and with your help, I can finally understand companies' income statements now.

  • @jrums
    @jrums 3 роки тому

    Awesome explanation, clear and straightforward. Thank you!

  • @dakotafleming5261
    @dakotafleming5261 7 місяців тому

    Thanks for the great content! Can you do a video about arriving at EBITDA and utilizing industry multiples?

  • @jaysant6958
    @jaysant6958 Рік тому

    What is a ready-to-go site that lists a company’s financial report? I’m trying to find one for the company I work for and only see old ones from past years and the most recent ones look nothing like this video, but numbers all over the place and not in a concise form. But an expense on page 7, and income on 3, etc.
    Is there a site where financial statements can be seen from any company that has to make them public?

  • @yazmut
    @yazmut 3 роки тому

    so well explained, thank you for the edu

  • @rafaelageyev9961
    @rafaelageyev9961 3 роки тому

    I think everyone would love to see you do a DCF model!!!

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      Thank you!!! Maybe I will put the video out soon :)

  • @ron403b
    @ron403b 3 роки тому +2

    I would be interested in learning about the discounted cash flow evaluation.

  • @amimellamanjose7687
    @amimellamanjose7687 2 роки тому +1

    Hi! Quick question, I am currently second year finance student in college. do you think that I should research on my own to learn stock market analysis? Or do you think that a fund or my college me everything I would need to know?
    Thank you!

    • @InvestorCenter
      @InvestorCenter  2 роки тому

      I would recommend studying Warren Buffett, Charlie Munger, Bill Ackman, and Mohnish Pabrai! My channel has a lot of good videos for you to start learning :)

  • @prabhuverma322
    @prabhuverma322 7 місяців тому

    hey i like your content, would you mind sharing how you prepare spreadsheet in detail?

  • @neilbrodsky2035
    @neilbrodsky2035 Рік тому

    Is there a way to download the spreadsheets you used to analyze the stocks without joining your monthly patreon? Can I do a one time purchase?

  • @javieralessandro8850
    @javieralessandro8850 2 роки тому

    Great video!!! Thanks for share!!!

  • @domceja62
    @domceja62 2 роки тому

    Can you please make a video on how to calculate the discounted cash flow evaluation to find intrinsic value?

  • @Allen-L-Canada
    @Allen-L-Canada 3 роки тому +2

    I really like to learn about how to understand and interpret the financial statement and numbers in them. Please do more of this.

  • @AdrianFernandezFazio
    @AdrianFernandezFazio 3 роки тому +1

    Great video! An explanation of Dcf will be nice. Greetings from Argentina!

  • @ghosm9855
    @ghosm9855 2 роки тому

    Very informing and great content. However, I was wondering do you not consider the consolidated statement of comprehensive income??

  • @flmjohn
    @flmjohn 3 роки тому

    Great Video and presentation to understand the concept, could you please make a video to calculate share price basis income projections. Thanks

  • @lowmett2165
    @lowmett2165 2 роки тому

    Hello. If Income statement data from QuickBooks and from tax return are different, is this normal?

  • @marvinschnee5574
    @marvinschnee5574 3 роки тому

    Great job very informative

  • @joelavoie9768
    @joelavoie9768 3 роки тому

    Fantastic video, thank you for sharing! :)

  • @josekuoman3006
    @josekuoman3006 2 роки тому

    it will be great if you can do a discounted cash flow evaluation

  • @jaysant6958
    @jaysant6958 Рік тому

    In case anyone is wondering,
    “The difference between them [gross profit margin and operating profit margin] is that gross profit margin only figures in the direct costs involved in production, while operating profit margin includes operating expenses like overhead.”
    From Investopedia.

  • @TheRustyLM
    @TheRustyLM 3 роки тому +1

    Thank you
    Thank you
    Thank you 🙏

    • @InvestorCenter
      @InvestorCenter  3 роки тому

      You’re welcome
      You’re welcome
      You’re welcome
      😊