A: The term “tech stocks” often refers to computer-related companies and software enterprises. But when you think about it, it’s hard to come up with many companies these days that don’t employ plenty of technology.

Think of automobile companies, for instance. Cars are big metal-and-plastic heaps of technology, and a lot of technology goes into designing and building them. The retail giant Wal-Mart uses plenty of technology in its operations, from inventory control to restocking inventory and processing payments. Likewise, United Parcel Service, FedEx and other delivery specialists rely heavily on technology. Even the Steinway piano company uses computerized, laser-guided, diamond-tipped cutting machines to cut wood. Of course, some companies do more than others. Intel, for example, is much more of a technology company than Tootsie Roll.

Before you get too excited about any new technology, glance back at history. Automobiles and airplanes were once new, exciting things. They changed our lives and society and became necessities. Yet in the long run, they haven’t proved to be the best places for investors’ money. Don’t think in terms of “tech stocks.” Instead, evaluate each company and industry on its own merits.

Ask the Fool: When a stock is reported as being up or down some amount, from what price is it up or down? – K.M., Huntsville, Ala.

A: When you hear that shares of Farm Dogs Inc. (ticker: BINGO) are down 21/2, that means they’re off $2.50 from where the stock traded at the end of the last trading session. So if BINGO closed at $60 per share yesterday and it’s trading around $57.50 right now, it’s down 21/2.

My dumbest investment: Years ago, a man at the bank convinced me that I could do better with money in mutual funds than in CDs. He recommended a fund that turned out to be rated in the bottom 15 percent of all large-company growth funds. Now I know why my investment is worth only half of what I originally invested. The fund even bought Enron and continued buying after regulators had sounded alarms. – Janice W., via e-mail

The Fool responds: The man was right, that many mutual funds sport better average annual returns than CDs do, especially in low-interest-rate environments. Still, there are good funds and bad ones.

Ideally, choose funds with no sales loads and ones with low annual fees. Seek fund managers who inspire confidence, who’ve been with the fund for a while, and who have market-beating records. For many investors, a simple broad-market index fund or two is all that’s needed. Learn more about mutual funds at www.fool.com/mutualfunds/mutualfunds.htm. For recommendations of top-notch, low-fee funds, try our Motley Fool Champion Funds newsletter for free at www.championfunds.fool.com.

Foolish trivia: I’m the largest publicly traded commercial health benefits company in the United States and an independent licensee of the Blue Cross and Blue Shield Association. Based in Indianapolis, I have a CEO that was named by Forbes as one of the most powerful women in the world. My members number more than 35 million and my employees more than 40,000. My stock has fallen some 40 percent this year, but its five-year average return tops the market. At the Fool’s CAPS stock-rating service (caps.fool.com), 207 all-star raters are bullish on me, vs. only seven who are bearish. Who am I?

Last week’s trivia answer: I was founded in North Carolina in 1946 and soon became known for low prices, because I’d cut out wholesalers and dealt mainly with manufacturers. For a long time, my main customers were professional homebuilders, but in the 1980s I began serving do-it-yourself consumers more. My new layouts are designed to appeal to women as well as men. Today I rake in sales of more than $48 billion annually, serving some 14 million customers per week at more than 1,500 stores. My stores typically stock 40,000 different products. I’m the second-largest home improvement retailer in the world. Who am I?

Answer: Lowe’s.

The Motley Fool take: Chesapeake Energy (NYSE: CHK) has declared itself the largest natural gas producer in the United States.

After some adjustments, Chesapeake turned in 29 percent year-over-year growth this quarter. If you’re wondering how such rapid expansion is possible for such a massive enterprise, you must not be following the shale story that’s driving Chesapeake and its peers.

Chesapeake has four huge shale plays, each of which involves tapping into laterally extensive natural gas deposits. The company is No. 1 or No. 2 in each play, of which the Barnett Shale is the most mature. The freshest play is the Haynesville of east Texas and northern Louisiana. Chesapeake keeps pounding the table on this play in particular, predicting that it will become the country’s biggest-ever natural gas discovery.

If that bold prediction becomes reality, Chesapeake might turn out to have been a screaming bargain now. The company pointed out in its recent earnings release that quarter-end enterprise value roughly matched the present value of future cash flows from proven reserves. The implication, then, is that the stock market is assigning no value to Chesapeake’s possible upside of 147 trillion cubic feet of gas.

Even if the Haynesville Shale play falls short, Chesapeake still has plenty of ways to unlock a tremendous amount of value not reflected in today’s share price.

The Motley Fool is written by Tom and David Gardner for Universal Press Syndicate. The name comes from Shakespeare’s “As You Like It” and the Elizabethan days, when fools were the only people who could get away with telling the truth to the king or queen. The Motley Fool tells the truth about investing. Reach the Gardners at fool@fool.com, or by regular mail to Motley Fool, PO Box 19529, Alexandria, VA 22320-0529.

HOW TO READ A COMPANY’S FINANCIAL STATEMENT

Trying to read and understand financial statements can be confounding, but it will be much less so once you realize that many items go by different names on different companies’ reports. For example, you might have learned to look for “revenue” on an income statement, but the income statement you’re looking at calls revenue “sales.” Even income statements themselves go by different names. Argh!

Help is on the way. The reference list below can make your life easier. It’s not comprehensive, but it covers many of the variations you’ll likely run across.

 • Accounts Payable = Payables

 • Accounts Receivable = Trade Receivables = Receivables

 • Additional Paid-in Capital = Capital in Excess of Stated Value = Capital Surplus = Paid-in Capital

 • Balance Sheet = Statement of Financial Condition = Consolidated Balance Sheets

 • Cost of Goods Sold = Cost of Sales = Cost of Revenue = Cost of Products Sold = Costs, Materials and Production

 • Earnings = Net Income = Net Profit

 •  Income Statement = Earnings Statement = Statement of Operations = Profit & Loss Statement = Consolidated Statement of Income

 • Inventories = Merchandise Inventories

 • Earnings Before Income Taxes = Income (Loss) Before Income Taxes = Earnings Before Provision for Income Taxes

 • Earnings Per Share = Net Income per Share = Net Income per Common Share

 • Net Income = Net Profit = Net Earnings

 • Revenues = Sales = Net Sales

 • Shareholder Equity = Shareholders’ Investment = Stockholders’ Equity

 • Short-Term Debt = Debt Payable Within One Year = Current Portion of Long-Term Debt = Notes Payable

If you’ve never tried to learn to read financial statements (balance sheets, income statements, statements of cash flow), give it a shot. It takes a little perseverance, but you can master it, and the payoff is well worth it. As you glance through a company’s annual report, important insights will pop out at you.

Learn more with “Financial Statements” by Thomas R. Ittelson (2008, Career Press, $18).

The Motley Fool