Fundamental Analysis

I'm still searching for new stock to buy. A little bit sidetracked by the share price movement on IBA. After announcing the talks with UK's iSoft, IBA's shareprice went down from $1.67 to $1.46 in two days. The market reacted negatively on the announcement. Other than concern about the acquisition, there are also concern on what price institutions will pay to fund capital raising because that may set the short term price target. Everything is still uncertain, and as IBA said this talks with iSoft may or may not lead to the aquisition. I'm waiting for a good price to buy IBA again, if any.

On my searching of new stocks, I am still wondering what is the best method to choose good stocks. My method so far, is to read from the market scan, winner or looser of the weeks, share picks, and then do my own search, before deciding to buy them.

I read about fundamental analisys using the internet a few days ago, and decided to try it out.
This time I am using the data from independent research company Aspect Financial. I have had their service for a while, but this is the first time I'm using their advance finder sort of thing, which allows the investor to search a sector for all shares meeting specific fundamental criteria.

I chose these fundamental criteria:

Value less than 3
Market Capitalisation greater than 100 million
P/E Ratio less than 25
Return on Equity greater than 5%
Earnings per Share Growth (1 year) greater than 5%
Risk Rating less than 3

The search left me with too many companies to look at; which give me another headache. I am still working on it, slowly, and hopefully will find 'good stocks' by the end of the week. A quick glance shows me that a lot of these stocks are actually in their downtrend cycle. This is to say that fundamental analysis can be valuable tool, but it should be approached with caution!