Some of the fundamentals to picking a good stock, Rory Gallagher Rooney Gallagher Private Group

Jan. 19, 2011 - PRLog -- Telefonica SA  is a member of our model portfolio; it meets 100% of the criteria we require when looking for growth and value notes Rory Gallagher.

The Joint Partner and Managing Director of Rooney Gallagher Private Equity Partners explains the company Telefonica operates in three business areas: Telefonica Spain, Telefonica Latin America and Telefonica Europe.

He continues, you must lay out a basic formula that you stick by when trying to locate an all-round stock we have our “Value Strategy” which looks for large, well known companies whose market cap is greater than $1 billion.

There is a very good reason for this, these companies exhibit solid and stable earnings. TEF's market cap of $104,501 million passes this test.

The second criterion requires that the company exhibit strong cash flows. Companies with strong cash flow are typically the value oriented investments that this strategy looks for.

The company's cash flow per share must be greater than the mean of the market cash flow per share ($1.21). TEF's cash flow per share of $17.48 passes this test.

This particular strategy looks for companies whose total number of outstanding shares are in excess of the market average (670 million shares).

These are the better known and highly traded companies. TEF, who has 1,505 million shares outstanding, passes this test.

A company's trailing 12 month sales ($77,662 million) are required to be 1.5 times greater than the mean of the market's trailing 12 month sales ($17,913 million). TEF passes this test.

The final step in the Rooney Gallagher Value strategy is to select the 50 companies from the market leaders group (those that have passed the previous four criteria) that have the highest dividend yield.

TEF, with a dividend yield of 7.51%, is one of the 50 companies that satisfy this last criterion. So I have given you the information its down to you if you choose to make money with it or not?

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