"As an analyst, we can do fundamental analysis of companies, but as an analyst, it's hard to do fundamental analysis of market sentiment".
Again, and I can't emphasize this enough, but fundamental analysis only gives an approximate value of what the price should be, which is important because that then tells you whether the market price is in the same ballpark (even if out in left field), as opposed to the market price not being in the same time zone, or within the orbit of Mars.
Are you good at technical analysis but bad at fundamental analysis?
One would think that the entire exercise these people go through would be considered meaningless, but the fundamental analysis industry is much too big and established, and there's no chance that this game will come to an end in our lifetime.
"Our fundamental analysis suggests fair valuation at $24, but we recognize that many 2005 catalysts and low relative valuation may move Pfizer shares," CSFB said.
But we also pride ourselves on fundamental analysis".
Fund documents will give vague platitudes about how the managers use "fundamental analysis" to find "highly profitable" companies that are "undervalued", but these terms lack clear definition.
Fundamental analysis is appealing because it comports well with common sense, but for it to work best, we'd need to be omniscient.
"Fundamental analysis says value stocks should be bought and tech stocks sold, but that's not what was happening," said Charles J. Gradante, chief investment strategist at the Hennessee Group.
Sound fundamental analysis examines not only the company's financial health and business strategy, but also its talent philosophy.
