Fundamental analysis is a method used by investors to evaluate a company's intrinsic value by examining various financial and economic factors. This process involves analyzing financial statements, including the income statement, balance sheet, and cash flow statement, to assess profitability and financial health. Investors also calculate key financial ratios like Price-to-Earnings (P/E) and Return on Equity (ROE) to compare performance against industry peers. Additionally, understanding management quality, industry trends, and macroeconomic indicators—such as GDP growth and interest rates—helps provide a comprehensive view of the company’s potential for growth and risk. By mastering these techniques, investors can make informed decisions and identify undervalued stocks in the market.