@guru267,
Are you an accountant?In this game I believe it pays to be one.

Totally disagree. You look at all statements to give you a view of the company in the long run. So if I look at the income statement and cashflow, I look over a period of 5 to 10 years to get a sense of the trends. Looking at one years of ststement and making a decision based on that would be dangerous.

BTW, the balance sheet give the picture of the company at a point in time (the date they are published). By the next day, maneno may be totally diffrent from what the balance sheet potrays.Plus these statements are not isolated as we make them sound. What's in the balance sheet captures the activity reflected in the income statement.

Not necessarily but I believe they have a head start

From my little accounting knowledge, accounts payable and receivables are just debts and amts due to creditors in future for transactions already done in the current financial period, and the P&L accrued, and hence do not reflect future income/costs.

Nways, I think with NSE, the bigger macro-environment is more important to look at in making a fundamental analysis > Eg. cheap imports from China & Taiwan will undercut business for Firestone, hence the expected future income is low = lower share price; Safaricom facing additional comepetion, but still having a strong holding and expanding product line = stable to stronger share price etc.

Note: a low P/E could either mean:
- The share price is undervalued, and it may be a good pick.
- Markets have priced in low future income expectations, hence the lower price and P/E.

my 2cts...

Does this not apply in developed countries?

having good macro economic knowledge even in kenya is another way... this knowledge can help one know which sectors will decline and which will explode regardless of current financials....

Looking at the macro-environment, do you think Unga "will explode" or will it implode "regardless of current financials"?

Financials are not the only way but financial consistency counts for a lot. Future outlook/vision, relevance, innovation and investment in technology are key too. A good example is Apple or Nokia, you'll hardly find anyone with a 3310 yet it was a household name just the other day, Nokia still is.

Best stocks thread on sk i have seen (note: not investment nor speculation but stocks thread). I will give my two cents. Test yourself and see what it takes to beat the market for sure. Its the books, the ideas, the economy, patience, rumors, professional insight, opportunity. its a few things and you dont have to be a genious (spelling?). That is fundah-mentality, you need to be like that, it is in my view impossible to teach someone to be an 'intelligent investor' it is more like a talent. There are limits to how you can teach someone to be a 'good dancer, singer, actor, painter'. Test yourself, if you can't beat the nse index most of the time and by at least 5% on chosen timed stretches/targets, let someone else do it for you or look for another business you can understand. But stocks not withstanding the aforesaid is a pretty simple way to grow wealth.

looking at the macro environment... all i can say is that the rains are falling this year and grains are giving bumper harvests and hence falling prices which spells well for Unga since it buys the maize and wheat....

kenyans still love their unga and they have a few subsidiaries in uganda so as the economy improves and more money in peoples pockets means more unga on their tables

higher revenues + lower costs =????????