You may have read our guide to How To Analyse A Stock, and now you know what the numbers mean.

But how do you analyse them?

Here, we will show you the must-know financial ratios to analyse a stock, using Starhub Limited’s financials as an example.

Disclaimer: This post may get pretty technical, but we will try to break it down into digestible pieces!

When you buy a share, your returns will come from two places.

Total Shareholder Returns = Increase in share price + Dividends over the same period

Dividend yield = Dividend/Share price

High dividend yields may be what you are looking for if you want to get passive income. But do take into account the movements in share price as well, which relates to the fundamentals of the stock.

Take Starhub for example, their share price reduced 3x in four