Giving Fundamental Data the Technical Analysis Treatment

By Matt Krantz

Some technical analysts love charts so much, they might even plot out some data that are traditionally considered to be for fundamental analysts. Even if you’re not onboard with technical analysis, there’s no question that sometimes, seeing fundamental data presented graphically may help you spot trends.

Plotting fundamental information, rather than just looking at table stuffed with data, may give you a unique perspective and help you to spot trends you didn’t notice before.

Price-to-earnings ratios, or P-Es, and dividend yields are two of the fundamental pieces of data that technical analysts most often will place on a chart. Looking at how P-E ratios are rising, or falling, over time can help you determine whether or not investors are getting overly giddy or cautious about a stock.

Slapping fundamental information on a chart may bring to light trends your eyes glanced over. There are online tools that make this pretty easy to do. Morningstar.com, for instance, provides a charting service that allows you to plot all sorts of measures important to fundamental analysts including P-E ratios and dividend yields. You can do this by following these steps.

  1. Log onto Morningstar’s site.
  2. Enter the symbol of the stock you’re interested in.
    After you enter the stock symbol into the blank at the top of the screen, click on the name of the company. Next, click on the Chart tab below the name of the company.
  3. Select the fundamental data you would like to see plotted.
    You can plot a variety of fundamental measures, ranging from P/E ratio to earnings growth and price-to-book. Click on the Fundamental option on the right-hand side of the page and start shopping.
  4. View the data.
    The data are then plotted for you in a chart.