1)Read the news. Not all stocks that are cheap is good for investment.Check id their is a lawsuit or bad news about the company.
2)STABILITY. Check the company's balance sheet. Check the total asset by its equities.
3.Price to cash flow ratio. This shows the cash of company per share it generates. It sometimes reliable than P/E ratio.
4. forward P/E- the price a investor are willing to pay for every dollar of expected earnings.
5.Trailing P/E- this is company's past earnings. This must be cheap before satocks rececnt drop.
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