What is a fundamental analysis of a stock?
A fundamental analysis looks at all things that could possibly affect the business of a company. Some of these things looked at are: the companys sales and earnings, the operating margins, the balance sheet, the composition of the top brass, the companys clientele, the prospects of the industry it is in, competition it faces and so on. In a fundamental analysis one would not make an analysis of the stock market or the stocks behaviour. With a fundamental analysis you might find companies that are fundamentally strong i.e., have an excellent business performance, but whose stocks are currently undervalued by the market.
