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 in this video i'm going to give you seven steps so that you can learn the most about a company with the least amount of effort expended the least amount of time we're all busy in today's day and age maybe you only have 500 to invest is it worth it for you to spend six hours doing due diligence on a company probably not due diligence is a bottomless thing and everybody always tells you to do it i even tell you to do it but if you want to do it right it's going to be a massive process but what

about if you just want to take a look at a company that you own right now or get an idea about where a company is going to go next a company that you want to buy this is the most you can learn about a company in the least amount of time if you want to just quickly go through and see where this stock is headed for many of you this is your first time here my name is peter leeds i'm the small stock specialist and you might ask yourself why you focus on small stocks in the peter leeds newsletter because they

produce the biggest gains and understand that nothing we say anywhere especially in this video is intended as personalized trading advice for you quick diligence is going to help you know where a company is in their life cycle it's going to save you a ton of time you're going to lose less money when you make a mistake you're going to make more money when you make the right call and before we get into the seven steps here just remember proper due diligence even this rapid diligence this quick diligence is more

about you than the stock you're investing in it's about you understanding what a company is where it's going and why it's going to get there and by when all of that will become a lot more clear as we walk forward through the fog what i'm going to do is i'm going to tell you the seven steps really quickly bang bang bang and then we're going to do it again and i'm going to show you on screen as i actually do it for an actual real company you can see what to click where to go all the stuff to do proper

quick rapid due diligence number one you go to the most recent quarterly balance sheet you see what the company owes versus what it owns and i should jump in here really quickly before i forget understand that proper due diligence is a massive undertaking and you're looking into every aspect of the company kind of like we do in the 29 point leads analysis process which i built and created for stocks five dollars and under but it applies and i think you should do this for any small stock or any large stock it applies even

for the blue chip companies if you want to see all the 29 points of our leads analysis go to peterleeds.com but in the meantime step number two now you're looking at the income statement you're seeing how much money they're bringing in what does it cost them to make that money then you can quickly identify the competition and then look into them and see if they're progressing or accelerating more than the company you're interested in if the company you like is the slowest grower

out of seven in the industry that's not a good investment possibly next you do a data absorption phase where you're going to read the management discussion and analysis maybe a couple of press releases take a look around the website and since we're talking about quick diligence here i'm not going to tell you to call the investor relations contact at the company you're going to learn what you can in the least amount of time that's what we're doing here only then do you

get to the trading chart you're going to look at things like the trading volume we're looking for simple technical analysis setups like resistance level support levels momentum indicators when you get to the chart phase it's really simple to look at quick and easy and you get an idea about how stock is doing health-wise just by looking at the trading activity over the last year or so and you can take a quick look at the analyst ratings i'll show you how to do that but i would warn you about reading too

much into these a lot of times these donkeys have different motivations than they pretend to have and the bonus point number seven here is actually kind of fun you're going to be a digital private investigator you can look into who's running the ship and what they've done before boom that's it seven steps and you'll be able to have a really good idea about any individual company especially even compared to their competitors and seeing how they're progressing and growing and accelerating

or not then you'll know better whether or not you want to be invested in that particular stock and also where you think they're going to go and by when this is the most you can learn about a company in the least amount of time now i'm going to record my screen and i'm going to show you we'll go through an actual stock and i'll show you exactly doing the seven step rapid diligence process we'll see if you guys like it i always like to use free and simple tools that are available online so that we're

all looking at the same stuff there's a lot of more advanced trading chart programs and more advanced sites that i'm going to show you this is supposed to be easy simple and quick especially if you're just getting started or if you don't have a ton of money to invest you don't want to waste 150 bucks a month on some kind of advanced third level quotes or anything like that i'm just going to show you what you can see for free online as long as you have internet access so i always like to go

to a nice simple charting website this is big charts bigcharts.com and we'll take a look at gamestop in this scenario so you put in the ticker symbol just get a basic chart but i'll tell you what my chart will look a bit different than yours because i went to advanced charting and i set up some of the settings but i'll zoom in here to two month chart so we can see it a little bit better and by disclosure i did own gamestop shares and i did sell gamestop shares but i'll tell you a couple things here

you see when the trading volume really increased and the price of the stock increased at the same time that's accumulation volume if you see a huge volume increase and the stock is falling that's people getting out of the shares they're liquidating their positions so anyways the seven steps number one you see here says profile and you can get all of this information it's publicly accessible and available through marketwatch google finance yahoo finance through big charts through any

online stock trading service it's going to have this information available for free so you choose what you like best or what's the best one for you but you go down here once you hit profile on the company and you're gonna see financials right here you know and every website's different so if you're on a different website there will be different places to get access to this information but it's all the same it just looks different so you're here on the income statement here's we're going to

do balance sheet quarterly i always tell you a balance sheet is a snapshot of the financial playstation of the company at that point in time if you do quarterly you'll get the most recent information when you scroll down here what are we looking at we're looking for assets versus liabilities how much they own versus how much they owe so they've got 2.6 billion dollars in total current assets and 3.68 billion and total assets current assets means that they're accessible or they're likely to be used

within the next 12 months a thing like a factory is an asset it might be worth billions of dollars but you're not gonna trade in and out of it or take money out of it on a short term basis that's something you invest in and you hold it for many many years so it's a long term asset so remember those numbers and then you go down here to total current liabilities 1.35 billion since that compares to 2.6 billion their total current assets are a lot higher than their total current liabilities so they have enough

money in the short term same thing with the long-term assets versus the long-term liabilities now we go to step number two let's go up here to the income statement and keep it annual at first because then you can see year by year how much money are they making and what you're looking for here is see if their sales are increasing over time on a year-to-year basis and you can see that they were doing a lot better in 2018 than they're doing in 2022. so that's a negative trend you can see here this is

what this is showing you it's high high lower even lower a little bit better and what this does it shows you out of that money here's all the costs to generate that money and to fulfill the sales of whatever they're selling and then you go to the net income so five years ago they made 230 million dollars in the year that's going to be earnings and the year after that they lost almost a billion dollars and they lost half a billion they lost 214 million they lost almost 400 million

dollars and this is the stock that everybody's buying it's all over the news so it's a good one for example but you can see people don't realize how much money they're just bleeding they're just bleeding cash and it goes down here to earnings you can see that they lost five dollars a share last year what we're gonna do though is even zoom in a little bit closer so you go quarterly and you'll see are they still losing money on a quarter by quarter basis the last three month period they lost 147 million

dollars the three months before that they lost 105 million tell me something if you were able to blow through that much money you'd have a pretty big company too you'd have a lot going on but it's not like they're profitable not even close quite the opposite this is a matter of time until this company has to restructure in my opinion now we're going to go into step three identify the competition get a look at that and see what we're dealing with so you go up here to overview

and then scroll down on the left side and i'll tell you again that there's other websites that'll be different but in this one this is how you find the competitors right here you can see who they're competing against you can even look at these companies a little bit more deeply to get an idea how they're doing in comparison the company you like and even put them on the chart see which one's been performing better for example swing back to big charts go to advanced chart and

we're going to do a comparison chart here put in the thicker symbol gamestop advanced chart and over here on the left side compare two let's compare it to one of their competitors apple and you can see this is apple's share price activity and performance and gamestop they both start on this chart at the exact same point and then you can compare gamestop did well did worse did okay came down a lot but meanwhile apple has been performing better over the year up 40 percent gamestop is down 15 percent but anyways

let's go back to the basic chart on gamestop back to the profile here and we're going to go on to step four data absorption underneath the chart you can see up here are news items that may be relevant and below are news items which were released by the company themselves or someone with a hidden motivation so here's for example gamestop investment analysis and if you care about all this stuff there's more to learn but i don't bother with this actually gamestop website any stock which is publicly traded is

going to have free access on their website to all the information needed as an investor so you go down here to investors you can get the quarterly results you can get the annual results and dig around a little bit in here until you get an idea about what the company is doing you read this stuff and you get an idea what they think is going to be happening in the future tells you how they've done and then they talk later about what they expect to do skip all this stuff if you want to you get an idea again of their

financials you can see last year they lost 5.25 per share anything you need to know by just looking through this stuff if you don't understand something it can be okay to gloss over it a bit especially if you're just trying to do a really quick look i personally look at thousands and thousands of stocks stephanie does a ton of it too she does the heavy lifting so it's very important that you're able to go through these quickly if you take too much time on anyone's stock it's

just holding you up to go to all the other hundreds and thousands of stocks that you've got to look at so you need to learn to be quick with the stuff if you want to go through a lot of options or if you don't have a lot of money to invest so it's not worth it to spend so much time doing it this is one of the ways you can do it so read any of the press releases that catch your eye and go through the website usually you'll be able to find a management discussion analysis in dna that's a great

thing to read if you only have limited time because it'll give you their full perspective of where they are at where they think they're going and why but always consider the source of any information you're looking at and the intentions of the person who gave you that information it's not always what you think it is but now we get to go to the trading chart so i always go back to big charts i lost my chart so we're gonna go gamestop gma is our ticker symbol give me a nice one month chart you can see

this is a very negative pattern but you're looking at the trend short term trend here was definitely higher then this is called a spinning top and if you guys take my candlestick trading chart course you'll get to see all stuff like this and i'll tell you something this is an indicator that it's a change in the trend and decision among investors but actually we're going to back out a bit of the six month chart and what you're going to look at just at a glimpse you look for things like

simple technical analysis setups like resistance levels support levels the current trend any trend reversal indicators it's all really simple stuff just by glancing at the chart but always pay extra special attention to trading volume this is a company that you already know now is losing hundreds of millions of dollars every three months and you can see the trading volume was really low and all of a sudden it picked up huge time and the stock price went up this is an artificial situation that's setting

up here a lot of people are buying into the stock right now but they don't have any idea how badly this company is being run but you do because you took less than four minutes just to quickly look into it and the more you do this the more quick it'll go for you you'll learn what to click where to go what to look at what it means really quickly as you become more practiced in it but here's something else i'm going to show you now for step number six out of seven so yeah we're almost done

that's pretty quick yeah analyst estimates boom right there you click it and i again will warn you analysts are not as good as they should be i'll see it that way they're wrong plenty of times a lot of the time they're telling you something because they have a different motivation for sometimes they're honest and they're just bad at it other times they're really straightforward and they're really good at it but you got to figure out which analysts you're going to

believe i don't trust any of them but you've got all sorts of things such as price targets for example right now there's one analyst saying hold two analysts saying sell i would suggest that this analyst saying hold doesn't know what he's doing but you can look at three months ago you can just tool around here and get to know what analysts are thinking typically generally you're supposed to think that an analyst will have a better view of it it's not just some retail investors so

yeah they should be a little bit better but i'll let you guys decide on your own it's just going to give you a better idea about what other people are thinking about this exact stock fuel upgrades and downgrades you can see by date which company maintains their rating downgrades upgrades downgrades and now here's the final step step number seven i'll call it a bonus step this is where you're going to be more like an online digital private investigator you're going to go to linkedin

you're going to search you find the chief executive officer of the company and you put them in the search field who is the gamestop ceo the ceo of gamestop is matt furlong all right so matt furlong matt furlong so you go to matt furlong scroll down and you're going to see who he worked for before who he worked with before he's an associate director for procter and gamble since they're such a big company it won't really help you ideally you find a company that they ran that was a smaller company you can see

if it did well or not if it did well then you know that people typically do what they always tended to do so to make one company increase in price a lot they're likely to do that again with the next company but since he worked for procter gamble on amazon and now gamestop you won't be able to tell if his involvement influenced the stock very much at all the bigger something is the more energy it takes to move it but that's just some of the things you can do those are the seven steps

of course you can do as much as you want it's a bottomless thing but you have to gauge how much time and effort you're going to put into it and how much you're going to get out of it this is in my opinion seven steps that will be the most result of understanding the company with the least amount of time you could obviously do more and you always should i can't tell you to not do complete total full due diligence i'm not saying that at all i'm telling you that if you go through these seven steps you're

gonna understand companies a lot better you got better results from trading them just remember if you really want to know what to look at for any company just drop over to peterleeds.com and look at the 29 points of leeds analysis thank you guys so much you guys are awesome i love helping you out i hope i'm helping you out and we'll have another video for you in a couple of days if you subscribe