The session started with a welcome address and opening remarks by FAM Dean Dr Sia Bee Chuan. “Although our students may have learned about the latest fundamentals of analysis tools such as financial ratio analysis and common stock valuation models from the textbooks and lecturers, I believe our students should continue to keep abreast of the industry’s needs and relevance. Our University has always been keen to produce graduates who are employable, not just book smart but also street smart. It is also aligned with the faculty’s mission—to be an outstanding business and management faculty of education and professional challenges which have transformative societal impacts nationally and internationally,” she said.   

In his talk, Yeong first defined fundamental analysis, saying that it is a method of evaluating the intrinsic value of an asset and analysing the factors that would influence its price in the future. He explained the two approaches of the analysis—top-down and bottom-up analysis, as well as the two aspects of the analysis—quantitative and qualitative aspects.

“Top-down analysis starts with a broader perspective of the economy, and then it moves to sector and industry specifics and further narrows down to individual company. Conversely, the bottom-up analysis begins with a specific stock of the company and move up by analysing sector specifics and the economy,” he explained. He then highlighted the equal importance of qualitative and quantitative aspects and said, “The quantitative aspect comprises of ratio analysis, trend analysis, peers comparison and future projections. The qualitative aspect consists of goodwill or brand recognition, competitive advantage, business model and management or corporate governance.”

Besides, Yeong shared some real-world examples and explained how to make use of the economic analysis, industry analysis and company analysis. “The economic analysis is very crucial to analyse the economy in detail in order to figure out different macro factors and their impacts on the company’s performance that will ultimately reflect and impact the potential of the stock. While the industry analysis is the overall performance and expectation of the industry that has a direct impact on the company’s performance. The company analysis is the internal performance of an organisation which is the most crucial part of fundamental analysis,” he elucidated.

Yeong also spoke about the reason for tracking the 10-year treasury yield. He said, “When there is an expectation for economic recovery, the share market tends to perform well particularly for those sectors which are affected by the pandemic. So for the industry analysis, it is very important to monitor the latest development and commodity prices in the related industry.” He also talked about the various sources of information to conduct company analysis such as annual reports or quarterly result releases of a company which could be found on the Bursa Malaysia website. He added, “Conducting meetings with the management of the company is also a key part of our job to understand the company better so that we can analyse the management strategy in line with our views. Financial publications like The Edge weekly and Focus Malaysia are also important sources that could help us stay ahead with the latest developments in businesses and politics to conduct the company analysis.”

The webinar continued with a Q&A session, where Yeong answered a plethora of questions such as what are the skills and knowledge required to become a fund manager, which valuation model is commonly used in the technology industry, and many more. Armed with this information, participants had a leg-up in not only understanding the fundamental analysis deeper but also learning how to apply them in real life. The webinar then ended with a photography session.