Bond investors are looking for a repayment of the principal and a return in the form of interest payments, or "coupon" payments, usually semi-annually.
The main criterion one should examine are the ability of the company to repay the debt ("times interest earned" or "interest coverage" is the yardstick) and one's expectations regarding inflation and interest rates.
Equity investors also want a return, generally in the form of appreciation or gain, and (less frequently) dividends. Capital gains are taxed at a more favorable rate than dividends, so firms tend to plow earned income back into the firm, seeking more positive net present value projects.
Equity investors should examine earnings growth, the firm's cash flow, the firm's management, the firm's assets and earning power, the value of the firm over time, and the values of similar firms or securities.
A good framework for qualitative analysis is Porter's 5-Forces model; formulas and models using discounted cash flow, comparables/market multiples, and net operating profits after taxes should be used.
With a bit of training and proper research, it is entirely possible to value a firm properly and accurately, particularly if one adopts a "buy, hold, and monitor" approach.
It's also exceedingly doubtful that the conditions that existed worldwide from 1929 to 1949 will ever repeat themselves any time soon.
Equities are the ONLY investments that have repeatedly beat inflation, over time. Any portfolio or savings plan that does not have a well-chosen exposure to equity investments may contain fewer short term losses, but the investor will over time surely lose significant amounts of money to inflation.
This is well-documented and verified by years of academic study. Miss out on equities and you'll be like the man who buried all of his gold and when he dug it up later found that he was much poorer.
Bonds barely beat inflation, not nearly enough to bother with in a long term sense, and precious metals fare even worse.
I'd encourage anyone to read "The Intellligent Investor" or any book by Benjamin Graham; "Common Stocks and Uncommon Profits" by Phil Fisher; and "Against the Gods: The History of Risk" by Peter Bernstein.
Good online resources include Damodaran Online, FinanceProfessor.com; and Investopedia.com.
A good designation for aspiring financial analysts is the CFA designation from the AIMR Institute; a working knowledge of financial accounting is also vital to understand equity investments at any level beyond the superficial.
See also "fundamental analysis," efficient market hypothesis," "modern portfolio theory," and "discounted free cash flow."
-Working Equities Analyst, MBA and market economist