Now that CFA level III is done with, I would like to start stock analysis. Can anyone recommend an easy tech stock to start with.
Go for stocks that recently went or are about to go public. Avoid the giants (i.e. Google or Microsoft) where you can analze them for years and still be clueless about one aspect of their business or another.
Is Amazon hard to analyze? The international operations part may be tricky, but I suspect the actual business model is remarkably simple.
Amazon is tougher than it appears. Amazon has been burning FCF for years as they invest in their cloud and web services infrastructure. You have to look at it from a residual income / EVA approach to see how they have been creating value while also making these capital investments. So many of the sellside have been focused on just sales growth to justify valuation but that leaves out the bigger picture. I interview associates all the time and Amazon is a question I always ask., When someone mentions P/E justifying value the interview ends and I show them the door.
Amazon can be very tricky if you consider the impact of Kindle and future in-house products (both physical and online services) compared to their core of online retailing.
A 1 year Morningstar subscription costs about $300, and it’s a really great place to start analysing any stock.
Take a look at Xerox, (David Einhorn Pick btw)