Investment Characteristics Essay

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Abstract Good investments are characterized by their strong propriety to the financial credentials of the purchaser as well as their investment time frame. They are also characterized by the future be created to and present income which can be immediately calculated. Also there is excellent suitability which can be related to the future goals of the purchaser. A good investment armed with the right qualities will definitely generate revenues a as well as profits. Fortune ran an article on Bob Olstein, an investment analyst who was particularly bullish at the time on several well-known stocks. He said the following indicators were the keys to his success. (1) a recent dramatic drop in the stock price, (2) company reports of positive free cash flow (net cash from operations minus capital expenditures), (3) conservative accounting methods, (4) a buildup in raw materials and partially completed inventory compared to finished inventory, (5) an increase in discretionary expenditures such as research and develop, (6) undervalued assets on the balance sheet, (7) little or no debt combined with a high return on assets, and (8) consistency between what the president’s letter said and what had actually happened over the past few years is the keys to his success: A recent drop in the stock price opens the door for immediate investments. This is available for those who already have stock and for those who want to become an investor or a shareholder. With this occurrence, a company can gain shareholders, investors and finances. For a business cash flow is its lifeline. Positive cash flow is always a plus. This means that the company is selling its goods and services and money is coming into the business. Also, positive cash flow shows that the daily operations of the company are generating enough cash to meet its business obligations. In

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