Fundamental Analysis.
Understand the business behind the price.
The Business
Examine revenue, cash flow, debt, competition, and management decisions. Compare stated plans with reported results.
The Expectations
Ask what growth and profitability the current valuation appears to assume. Consider how interest rates and industry conditions affect that view.
The Question
Identify what could weaken the thesis and what evidence would change it. A valuation model is a set of assumptions to review.