Finance Analyst Interview Question:

Explain me the single best evaluation metric for analyzing company stock?

Submitted by: Muhammad

There is no specific answer to this analyst interview question and hence, it is mandatory to mention a reasonable point of evaluation and explain the context for using the metrics. When you estimate a company, mention the first point as the operating margin profit as the metric. Mention that you opt for this metric because it shows the management of the company overall apart from the basic profitability. The price earnings to growth ratio can also be mentioned as a single most complete equity valuation metric. You can give a reason that it considers projected earnings growth rate and also higher ranked commonly used price/ earnings ratio (P/E). Make sure to pick any evaluation metric that you prefer is the best. The main trick in answering this question is explaining the strength of the particular metric that you mention.
Submitted by: Muhammad