Wednesday, February 22, 2012

Dow Jones Review 1

In this section we will look closely at one stock in the Dow Jones Industrial Average, or Dow 30.

Today it's Alcoa Inc.  Symbol is AA

Today's Price is 10.38 It's an inexpensive trading stock.

Alcoa is a major Aluminum producer. What makes Alcoa special is that they take raw materials and forge it into a finished product, Aluminum. Basically turning nothing into something, and that's always important.

Trading volume: 22,844,756  There will always be someone to trade Alcoa stock with.

Stock Options: Good Options, to sell covered calls, or puts.

Market Cap:  11.07 Billion  Alcoa's a big company.

P/E  ( Price earnings ratio, the price of the stock compared to the companies earnings )  is 18.87 times earnings. It's a little high, but the markets way up.

EPS  ( Earnings per share ) is 0.55 Alcoa makes 55 cents per share.

Dividend and Yield is 0.12 ( 1.20 )  Alcoa will pay you a little bit just to own the stock. But it's still more than a savings acct. You always have to look and see how much a savings acct would pay. It will make you want to buy more stock.

Beta is 2.02  Beta measures how much the stock will move in price compared with the general market. A beta of 1.0 moves at the same rate as the market. A beta of 2.0 moves at twice the rate as the market. Any negative beta such as -0.50 means that the company's share price moves slower than the general market.  Any stock that has a beta of 2.0 or greater is a good trading stock.

Quarterly Revenue Growth is 6.0%

Gross Profit is 4.47 Billion

Profit Margin is 2.45%  Any company you invest or trade in should be profitable. Only unprofitable companies go out of business.

Book Value per share is 12.96. OK so today's price is 10.38, the stock is worth 12.96 a share because of its assets. The second someone bought this stock they

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