Can anyone recommend a book about interpreting financial statements?

gonedrinking

With a view to value investing. I've seen a few books on value investing but they are all mainly discussing the concept of value investing and not really going into much details on the methods and techniques of working out whether a share is undervalued. So can anyone recommend a good book for this purpose?

colsku

http://www.amazon.co.uk/gp/product/0273663127/ref=oss_product

This is meant to be the bees knees!

ixus

colsku wrote: »

http://www.amazon.co.uk/gp/product/0273663127/ref=oss_product

This is meant to be the bees knees!

I'd second this or any FT book on said.

Speculator

As per IXUS comment, I found Reading and Understanding the Financial Times by the FT very good.

http://www.amazon.com/Reading-Understanding-Financial-Times-Boakes/dp/0273731815/ref=sr_1_6?ie=UTF8&s=books&qid=1279177306&sr=8-6#_

learntheHardWay

the bible

daithi7

You mentioned reading a few value investing books, if you haven't read 'The Intelligent Investor' by Ben Graham (revised by Jason Zweig), I'd thoroughly recommend it and his chapters in it on investment analysis and interpreting financial statements are gems.

For instance because of all the chicanery that goes into annual reporting on wall st, Graham recommends mostly valuing things on 3 yr trailing earnings as this evens out many of the exceptional losses, write downs, charges that seem to reoccur every other year anyway.

Jim2007

It is also worth having a look at "Quality of Earnings" by Thornton L. O'Glove, but just bear in mind that it is based on US GAAP rather than European accounting standards.

Jim

hmmm

Any first/second year accounting text.

MacStacked

This is by no means a replacement for the texts you are looking for, but a sort of online brief introduction you might find of help.

http://www.fool.co.uk/school/2005/sch050819.htm

daithi7

On value investing I've been reading several of the Little Book series on value investing, all excellent so far, after the Intelligent Investor, which is the bible, I'd highly recommend them. Also reading the Intelligent Asset Allocator which is a good follow up from the bible above!!

Gandalph

"Security Analysis" by Ben Graham?