Qualitative factor of fundamental analysis

How Qualitative Factors Impact Fundamentals

Although relatively more difficult to analyze, the qualitative factors are an important part of a company. Since they are not measured by a number, they tend to be subjective and represent either a negative or positive force affecting the company. But some of these qualitative factors will have more of an effect than others, and determining the extent of these effects can be challenging.

Examples of qualitative factors include customer satisfaction with a company’s products, pending litigation that harms a company’s reputation, a change in a company’s management, the relationship the company has with key vendors, or ownership of a new technology that gives the company a competitive advantage.

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