Step 1 of 11
How to understand the business
Before any number: what does the company do, and how does it make money?
Click any Tap any word with a dotted underline to see what it means.
Numbers only make sense once you know what they describe. Before looking at any metric, take a few minutes to understand what the company sells, who buys it and how it earns money: its .
What to look at
- The company description on StockLab, and the "Business" section at the start of its , where the company describes itself in its own words.
- What it sells and to whom: consumers, other businesses or governments.
- How it charges: one-time sales, subscriptions with , a fee on each transaction, or advertising.
- Its sector and industry, and its main competitors.
Questions to ask yourself
- Could I explain in two sentences what this company does and how it makes money?
- Why do customers choose this company instead of a competitor? Is there a that is hard to copy?
- What would have to change in the world for this business to sell much more, or much less?
Keep in mind
If you can't yet explain the business simply, it helps to read more before drawing conclusions from its numbers.
On StockLab
Every company page starts with a short description, the sector and the industry. The sector also decides which companies make up the sector medians you'll see in later steps.