All negative information has reasonable explanations, but many explanations only tell investors "I will work hard", and more explanations are to cover up strategic mistakes with tactical diligence.

Second, the analysis should not be affected by the stock price.

Although value investors believe that the market will make mistakes and want to look for opportunities from market mistakes, in fact, most investors believe that the stock price trend hides something we don't know. Therefore, in the upward trend, investors are used to looking for good things in financial reports, while in the downward trend, investors are used to looking for bad things in financial reports.

Three, a word can't change the long-term market cognition.

There is a saying called "Don't try to educate consumers". There are also some long-standing understandings in investment, which will not be reversed because of an excellent financial report. For a more difficult logic like "the cycle becomes longer", the market must have more than three financial reports to confirm it. The previous good financial reports were all high and low, and returned to the shock range.

Preparatory work/about to start work

First, understand the basic research methods and current situation of the industry.

Every industry has its own business logic and basic research methods, and we can't just look at revenue and profit. For example, industries that value assets invest first and then make money through scale effect; Industries that value assets compare operational barriers and operational efficiency; The industry that sells people's heads looks at project resources and management efficiency; The industry selling brands depends on gross profit and channel control ability.

Second, understand the basic financial common sense.

Needless to say, corporate financial reports are based on three financial statements, and at least we should understand the contents, functions and relationships of major financial departments.

However, we should not overemphasize the three forms. Read the financial report, not the financial data. Although in fundamental research, many investors like to choose stocks through financial data, including quantitative procedures, but financial data is more about verifying research speculation.