The simple way to Use Annual Report

By Philip Usher


There are many steps in calculating the fair value of a company. But before we even do that, it is vital to learn how a company earns its profit. Does it do that by selling to consumers licensing its technology to other corporations or removing natural resources from the ground?

The sensible way to do it is by reading the company's yearly report. What's an annual report? Annual report is annual publication by public corporations to better inform financier about the organization's kind of business. Annual report gives investors a glance of the company's form of business, monetary health as well as management's systems for doing business.

Let's look at CNET Networks Inc. The company trades in the Nasdaq market with symbol: CNET. What does CNET do? I know CNET owns cnet.com. But do you know that it also owns download.com, MP3.com, ZDnet.com and News.com? How do I'm sure that? Yes, you guess it. CNET's Annual Report will gives you all that.

From CNET's annual report, we are able to do a little digging for CNET's web traffic. As of August 27th 2005, these web sites of CNET draws 3 % of all net traffic. Pretty impressive, considering that Google holds 23% of all net traffic. On April 2005, Google had 78.6 million unique visitors. By comparing this metric, we might have an idea CNET's revenue potential for the month of August. I won't go into that but this shows how helpful reading CNET's yearly report is. Reading a once a year report serves as step one toward making an investment in a selected company.

How can we obtain yearly report? There are several sources for this. First is the companies own web site. You've got an interest in knowing more about CNET Networks? It's easy to get the annual report by going directly to http://www.cnet.com and go to its stockholder relation. After one or two clicks, you can then download the once a year report.

Or ... You can go to some websites that offer complete annual report for a number of different firms in alphabetical order. Our web site is one of them. Admittedly, while having masses of yearly reports in one place is useful , it isn't as comprehensive as what the company's own web site has to say.




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