Industry Metrics

Every company performance is measured by the industry's metrics. An investor needs to know what the wall street used to measure so that the company can be evaluated correctly.

The following information is from FastMoney show:
http://www.cnbc.com/id/21901167

TRADING BROKERS

Metrics That Matter?

1. - M&A Advisory Business
2. - Underwriting
3. - Trading

TRADING RETAIL STOCKS

Metrics That Matter

1. - Same-Store Sales (A.K.A "Comps")
2. - Fashion Initiatives
3. - Execution

Usually on the first Thursday of every month the retailers release same-store-sales, which are a report card for the sector, says Jeff Macke. Don’t own a retailer who’s missing their numbers.

TRADING DRUG STOCKS

Metrics That Matter

1. - Conferences & Clinical Test Trial Dates
2. - Current Roster Of Drugs
3. - Pipeline Of Future Drugs

It’s important to know these metrics says Pete Najarian because drugs sometimes hit stumbling blocks. Of course, other times they become multi-billion dollar blockbusters.

TRADING ENERGY & COMMODITY STOCKS

Metrics That Matter

1. - Price of the Commodity
2. - Beware Valuation
3. - Stocks are NOT a proxy play for the underlying commodity

Guy Adami feels the third point is extremely important. For example, he says if you’re bullish on gold don’t buy a mining company such as Newmont Mining (NEM) because you also get all kinds of corporate risks.

TRADING TAKEOVER TARGETS

Questions You Should Ask

1. - Are there "supervoting shares"?
2. - What state is the company incorporated in?
3. - Are there big shareholders who've been active in the past?

Stay away from companies incorporated in Pennsylvania, says Karen Finerman. They’re not shareholder friendly. By contrast, Delaware is extremely friendly. And you can find out the state of incorporation on the front of a “10-Q”

TRADING DEALS "IN LIMBO"

Questions You Should Ask

1. - What kind of bidder is it? Corporate?
2. - Is it a "trophy property"?
3. - What leverage can the buyer use against the target?

Finerman says when you’re looking at the bidders, determine if they’re corporate bidders or some kind of LBO. Finerman likes corporate bidders best.

TRADING CHIP STOCKS

Metrics That Matter

1. - Global Demand
2. - Commoditization
3. - Gadgets

Gross margins are very important explains Guy Adami. Intel’s (INTC) margins are expected to go higher into next year and that makes it a stock he wants to own.

TRADING SOFTWARE & VIDEOGAME STOCKS

Metrics That Matter

1. - Product Cycle Demand

Judge video games by the hardware release, says Jeff Macke. Typically Sony (SNE), Nintendo (NTDOY) and Microsoft (MSFT) lead on new consoles he says. A few years after that, profit margins are strong on the new software titles.

TRADING GADGETS AND TELECOM

Metrics That Matter

1. - Product Cycle Demand
2. - Wireless Capacity

Pete Najarian investigates how much growth lies ahead for companies in this sector. For example, he likes Research In Motion (RIMM) because Pete anticipates they will explode when they get into China.

Video clip is here:http://www.cnbc.com/id/21998606#