Whether you’re training for a marathon or going on an adventure trip, being ready can make a world of difference.
The same is true for the stock market. It’s important to be prepared with a watchlist of fundamentally sound stocks ready to be bought at the right prices. Whether the market is in rally mode or in a phase of correction, being prepared with a watchlist is key.
Here is Version 4.0 of my Stock Analysis Excel Sheet that will help you with exactly that – identify high-quality businesses to create your watchlist and buy them when the prices are right.
Download this sheet on your computer, read carefully through the instructions to follow a few simple steps, and then analyze not just the past performance of a company but also arrive at its approximate intrinsic value range.
Like the previous version 3.0, this latest version feeds in data automatically from Screener.in website, which subsequently feeds into my sheets on financial analyses and intrinsic value calculations. So, please thank Screener’s creators and my friends Ayush and Pratyush before thanking me. 🙂
If you have been into financial modeling in the past, this excel file may seem like a child’s play. But, if my 15+ years of experience as an analyst is anything to go by, this is most of all you require to “quantitatively” analyze stocks…not models running into hundreds of rows and tens of sheets.
I have personally tried my hands at both the kind of models – the simple one that you can download below, and the complex ones that most analysts use in their doomed pursuits of finding the elusive target prices. Without a doubt, simplicity beats complexity hands down.
By the way, the excel that you will download below – and especially the intrinsic value calculations therein – works well with simple businesses that have a good track record of performance. Complex, volatile businesses must not be analyzed anyways, and no spreadsheet can help you there. Also, this excel won’t work for banking and financial services companies.
New additions to this version over the previous one include – explanation of key ratios, new sheet on ratio analysis, and sheet containing few performance charts that will tell you in a snap how the business has done over the past few years.
Finally, as I had mentioned for the previous version, this version also contains a Data Sheet, which is the core sheet from Screener.in site and any changes to it may produce errors if you want to customize the Safal Niveshak excel and upload again to Screener’s site. So, please don’t touch this sheet at all.
Words of Warning!
Before you get down to using this excel, remember six critical things…
- It’s just a compass and not a map. So take your next step carefully.
- Don’t look for perfection. It is overrated.
- Focus on decisions, not outcomes.
- Look for disconfirming evidence. Avoid falling in love with the numbers.
- Remember Charlie Munger who said, “All I want to know is where I’m going to die, so I won’t go there.” Depending just on this excel for decision-making can really kill you (financially)!
Let me know if you found this excel helpful. I will try to improve upon this in the future based on your feedback.
Share your thoughts, suggestions, and testimonial for this excel in the Comments section of this post.