Investing, explained simply.

For every company we cover, we give one clear verdict.

• BuyET&A sees significant upside from the current price with an attractive risk/reward profile.
• AccumulateET&A likes the company but would prefer investors to build exposure gradually.
• HoldET&A sees limited reason to buy aggressively or sell at the current price.
• ReduceET&A believes the current valuation or risk profile makes a smaller position more appropriate.
• SellET&A believes the downside risk materially outweighs the potential return at the current price.

ET&A's overall assessment of the investment, out of 10 — business quality, valuation, expected return, risk, confidence in the valuation, catalysts and downside. It is not the Quant Score: an excellent company can score modestly here when its shares are expensive. It sums up how good the business is, how it is performing, its price and its risks.

• 7.5 and above — strong
• 5 to 7.5 — mixed
• Below 5 — weak

ET&A's estimate of what the shares are reasonably worth today. We base it on the company’s earnings, quality, growth and risks.

If the share price is below our Fair Value, it may be cheap. If it is above, it may be expensive.

ET&A's base-case estimate of what the shares should reasonably be worth approximately 12 months from the valuation date using forecast fundamentals and the ET&A valuation methodology. It is not the Fair Value: Fair Value is what the shares are worth today.

We always show it with its horizon — 12 months and the target date — and with the return it implies from the price at the valuation date, including expected dividends.

The price range at which expected return becomes attractive enough relative to risk. In other words: low enough that the return we expect over twelve months — to the 12M Price Target, plus dividends — clears the return we require for the company’s risk.

Above the range, we would usually wait. Inside or below it, the price looks attractive to us.

Fair Value, the 12M Price Target and Preferred Entry are part of ET&A membership.

Where today's price sits against what ET&A thinks the company is worth. We place every company on the same five-step scale:

• Very CheapBelow our Preferred Entry.
• CheapInside our Preferred Entry.
• FairAbove our Preferred Entry, up to our Fair Value.
• ExpensiveAbove what we think it is worth — up to 25% above Fair Value.
• Very ExpensiveMore than 25% above what we think it is worth.

How strong the company's finances are: sales, profits, debt and cash. We rate each part on a six-step scale: Weak, Below Average, Average, Good, Strong, Excellent.

• Revenue — how big the business is, and are sales rising?
• Earnings — is it making a profit, and is that profit growing?
• Margins — how much of each sale it keeps as profit.
• Cash generation — how much spare cash it produces.
• Balance sheet — how much it owes compared with what it earns.
• Dividend — what it pays shareholders, where it pays one.

The ratings aren’t opinions: each one is a company figure scored on the same fixed scales ET&A uses in its research. Every company page shows the figures and the working in its Research View, under “Scoring calculations”.

Some companies suit careful investors; others suit people happy to take more risk. We show which of ET&A’s five investment goals each company fits.

• Capital Preservation — Protect what you have. Steadier companies, smaller swings.
• Income — Get regular payments from dividends.
• Balanced — A mix of steady income and growth.
• Growth — Grow your money over time, accepting more ups and downs.
• Aggressive Growth — Aim for the biggest gains, accepting the biggest swings.

We also tag each company with an investment style: Quality (a strong, well-run business), Growth (sales and profits rising fast), Value (cheap for what it is) or Income (pays good dividends).

Every company page is built in three layers, so you only go as deep as you want to:

• Quick View — the short answer: our ET&A View, ET&A Score, Fair Value, and whether the shares look expensive.
• Investor View — sections you open one at a time: our full view, what could drive it higher and what could go wrong, the valuation, the financial trends, who it suits and how it compares with peers.
• Research View — for detailed analysis: the full financial statements, valuation multiples, history, forecasts, methodology and the valuation model itself.

Owning lots of companies from the same industry or country means one piece of bad news can hit everything at once.

Spreading your money across different industries, countries and types of company makes the ride smoother. ET&A Wealth Builder shows you where your money is concentrated.