Investors are also advised to study other companies operating in the line of their preferred company. This is another alternative for predicting the sustainability of the company as the future of the company is determined by its capacity to withstand competition and continue making profit even in a competitive environment (Brealey, Myers and Alan, 478). Depending on the strength of the chosen company to withstand competition and the level of competition staged by other companies, an investor will be able to understand if the company is an ideal investment which is able to withstand competition in the present and in future. A company with a possible success in future is a better option than one with higher profits presently but likely to make massive losses in future due to competition(Fischer and Jordan, 98).
Any type of investment taken should be evaluated and a prediction be made with as much precision as possible. One would rather earn little profit than invest in a highly profitable business with high risks which might lead to loss of the money already earned. It is advisable to strike a balance between profits gained and the risks involved (Shapiro, 782). An investor should also consider other factors other than the general appearance of a company. Thus one should consider the business in the company and not how much he/she likes a company’s products(Harold, 29).
From the chart above it can be observed that the stock of NEM was the highest in 20th September as results of the information and dividend of the company. The stock then started decline in value.
The stock of FOSL was the highest on 18th October, 2010. What it can be observed that the changes in this stock was as result of information relating to the market rather than the company. The main reason for my conclusion is because the growth is continues and is a slide improvement. The trend observed by this is stock is similar to what is taking place in the market.
Factors That Contributed NEM Stock Price Change
There was some information that affected the stock of the company prices. The company had initially corrected the rumours that were going around about the destitute shares of the company. The inclusion of the company in the Dow Jones sustainability index was other news that influenced decision making about purchase or holding of the shares of the company. This kind of decisions affected the performance of the prices of the company in the market. The earnings information also played a major role in the pricing of stock in the market. The company was also awarded as the best supplier in the US this contributed to the growth of the company. The prices changes of units of gold become another good source of information for prices for this company (Finance yahoo, Newmont Mining Corp, 1)
Stock Market New For the Last 3 Months
There was news that trickled to the market which affected the performance of the stock. The major news was the financial crisis in Greece which made investors lose some confidence in the stock market. However, the good news was the recovery of some companies something that triggered investor’s confidence. There was also improvement in Dow Jones industrial average due to the performance of various stocks (Finance yahoo, 1).
In late September the Federal Government want of price changes due to inflation rates in the market. There was an end of recession, something tha contributed to the boom in the market. In the same period there were also changes in oil prices and gains in dollar value, something that can be said to have contributed to the improvement of shares of the company. The Middle East Peace Talks also contributed greatly to the changes in the stock market. It is important to note at this juncture that most of these affected not only ones stock but the market as a whole (Finance yahoo, 1).
References
Brealey, Richard, Myers, Stewart & Marcus, Alan. Fundamentals of corporate finance. Boston: McGraw-Hill Irwin, 2007.
Finance yahoo. “Fossil, Inc. (FOSL)”. Finance yahoo. 2008. Web.
Finance yahoo. “Newmont Mining Corp. (NEM)”. Finance yahoo. 2008. Web.
Fischer, Donald, & Jordan, Ronald. Security Analysis and Portfolio Management. New Delhi: Prentice-Hall of India Private Limited, 2007
Harold, Bierman. Increasing Shareholder Value: Distribution Policy, a Corporate Finance Challenge. Massachusetts: Kluwer Academic Publishers, 2001, p. 23
Shapiro, Alan. Foundations of Multinational Financial Management. New York. John Willey & Sons, Inc, 2002.