Metrics for stock evaluation

[amoeba]

An investment newbie here.

After reading a few books, I understand the general idea of diversification etc. I also understand that when buying specific securities (individual stocks) instead of index funds, sufficient research is required.

Thus, I would like to ask what metrics is most useful when researching individual securities.

Just as an example, when I'm looking to purchase a growth stock, how much weight should I put in to say its PEG ratio?

Also, when evaluating a security, if you were to list the metrics from most important to least important, what would they be?

[PRE]

To be honest, it sounds like you have a very long way to go before picking good individual stocks.

I would just invest in some type of fund.

Looking at individual metrics alone is a terrible idea.

[amoeba]

[ QUOTE ]
To be honest, it sounds like you have a very long way to go before picking good individual stocks.

I would just invest in some type of fund.

Looking at individual metrics alone is a terrible idea.

[/ QUOTE ]

I am mostly invested in funds but would like to start on individual stock investment.

If metrics is a terrible way to go, then what do you look at with regards to the evaluation of individual stock?

[amoeba]

Also, often when you have a certain idea about a stock, how do you know if it isn't already priced in to the market?

[PRE]

[ QUOTE ]
Also, often when you have a certain idea about a stock, how do you know if it isn't already priced in to the market?

[/ QUOTE ]

Run a valuation model dicounting the future cash flows (including the effect of your idea on the cash flows" to the present value to get an intrinsic value.

[donkeykong2]

dont even try to do that. people with much better information and more money than you should have done that before and were probably more accurate.
if you want to buy single stocks with little diversification you should not take some with low systematical risk (beta) and high volatility unless you want to gamble.

[SlowHabit]

Just out of curiosity, what are the names of the few books? Please list them all.

[amoeba]

I've read Intelligent Investor, Fooled by Randomness, and How to Make Money in Stocks though I didn't like that last one very much. It seemed shady for some reason.