Hi All!

A wee bit of spare time so outlined my basic Red Flag / Pink Flag Checklist - Don't mean it to be excessive or anything like that but wondered what other Red / Pink Flags others had.

I come at this from the perspective when I find a share I like and want to buy - I like to try and identify any high level negatives.

The main thing apart from this is checking Stocko comment history for any underlying fundamental flags identified by the SCVR guys and other Stocko members - Cause I'm not smart enough for that kind of depth.

Anyway, here we go - Perhaps I will do a final list in a few weeks after input from all, if there is in fact any interest and input at all!

2 Red Flags = Seriously consider not investing
1 Red Flag and 2 Pink Flags = Seriously consider not investing
4 Pink Flags = Seriously consider not investing

Red Flag

PER < 6 or PER > 40
No Revenue
No Profit
Dividend Cut
Net Debt > 25% Of Mkt Cap
Spread > 10%
AIM Listed Abroad

Pink Flag

PER < 8 or PER > 25
Revenue down or forecast to be down
Profits down or forecast to be down
EPS down or forecast to be down
Operating Margin down
Operating Margin below Sector average
ROCE down
ROCE below Sector average
Dividend flat
Dividend cover < 1
Net Debt > 10% of Mkt Cap
Spread > 5%
Broker EPS forecasts revised down
Change of Financial Director

Do remember this is a kind of final run through sanity check I use before taking the plunge to keep me (hopefully) out of trouble!

All comment and input is most welcome and appreciated.

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