March 3, 20170Comments

Filing Season Finds: Friday, March 3

Yesterday, our analysts parsed 128 filings and collected 18,702 data points. In total, they made 3,174 adjustments with a dollar value of $1.1 trillion. In particular, analyst Peter Apockotos found an unusual item yesterday in MGM Resorts (MGM) 10-K.

by Sam McBride

March 2, 20170Comments

Filing Season Finds: Thursday, March 2

Yesterday, our analysts parsed 134 filings and collected 20,247 data points. In total, they made 3,401 adjustments with a dollar value of $1.3 trillion. In particular, analyst Hunter Gray found an unusual item yesterday in Nabors Industries' (NBR) 10-K.

by Sam McBride

February 28, 20170Comments

Filing Season Finds: Week Of February 21-25

Last week, our analysts parsed 378 filings and collected 56,507 data points. In total, they made 9,646 adjustments with a dollar value of $5.3 trillion. Analyst Lindsay Bohannon found a few items in Cigna’s 10-K last week that should put the stock back on investors’ radar.

by Sam McBride

February 23, 20170Comments

Filing Season Finds: Thursday, February 23

Yesterday, our analysts parsed 92 filings and collected 13,987 data points. In total, they made 2,451 adjustments with a dollar value of $1.6 trillion. Analyst Hunter Gray found an unusual item in Advanced Micro Devices’ (AMD) 10-K.

by Sam McBride

February 21, 20170Comments

The Real Earnings Season Starts Now

Corporate earnings season may be winding down, but the real earnings season—annual 10-K filing season—starts today.

by Sam McBride

January 11, 20170Comments

The Real Earnings Season Doesn’t Start Until February

Monday marked the unofficial start of “earnings season.” Then, once all the craziness has died down, the real earnings season—10-K filing season—will begin.

by Sam McBride

October 18, 20161Comments

Netflix: Look Past the Headline “Beat”

In the wake of 3Q16, Netflix (NFLX) is up nearly 20%. Is this price reaction justified? Have investors gotten too caught up in the “membership beat” or recently lowered expectations?

by Kyle Guske II, Senior Investment Analyst, MBA

September 23, 20164Comments

What’s The Problem With Non-GAAP Earnings?

Non-GAAP earnings are back in the crosshairs. 15 years after the Enron scandal first prompted the SEC to create rules for non-GAAP metrics, the proliferation of these pro forma results have led to renewed scrutiny.

by Sam McBride

July 25, 20160Comments

LUV Earnings: Market Overreaction Creates Buying Opportunity

After announcing 2Q16 earnings, LUV fell nearly 12%, as investors seemed to care more about Southwest’s ability to hit analyst expectations, which have inherent flaws, and less about the company’s record profits.

by Kyle Guske II, Senior Investment Analyst, MBA

April 28, 20160Comments

The SEC Is Starting To Worry About Non-GAAP Earnings

We’ve been sounding the alarm on non-GAAP earnings for several years now. Companies exploited the wide leeway granted by the SEC to present their business in a more favorable light.

by Sam McBride

November 30, 20152Comments

Why PE Ratios Are Not A Good Measure Of Value

We’ve pointed out the flaws in the price to earnings (PE) ratio many times before. Chief among these flaws is the fact that the accounting earnings used in the ratio are unreliable for many reasons:

by Sam McBride

November 12, 20150Comments

The Dangers of Non-GAAP Earnings Webinar

To learn the dangers of non-GAAP earnings and how to overcome them, join CEO David Trainer, a Wall Street veteran, in this week’s free webinar “The Dangers of Non-GAAP Earnings.” David will discuss what goes into non-GAAP earnings, why they create a problem in investing and analysis, and where you should focus when analyzing companies who report non-GAAP results.

by Kyle Guske II, Senior Investment Analyst, MBA

July 23, 20140Comments

Angie’s List Is In Trouble

Angie's List (ANGI) reported a larger than expected loss on Wednesday, and its revenues grew slower than expected.

by David Trainer, Founder & CEO

July 16, 20140Comments

Update: Intel Earnings

In my most recent article, I said that modest growth over the next 15 years makes Intel worth ~$41 share today, and this earnings report strengthens my belief in that fair value estimate.

by David Trainer, Founder & CEO

August 26, 20100Comments

JDS Uniphase Cp (JDSU) — free report for Ask Matt, Dangerous Rating

RED FLAG: Our analysis of the Financial Footnotes reveals: the company has written off over $60bn in assets over the last twelve years. That is a big number compared to the company’s market cap of roughly $2.2bn and its net assets of about $1.3bn. This results in economic earnings of -$5,346mm compared to Net Income of -$866mm during the last fiscal year. For details on what causes the difference between Economic Versus Accounting Profits, see Appendix 3 on page 10 of our free report on JDSU.

by David Trainer, Founder & CEO

August 24, 20100Comments

Stock Pick of the Week: Sell/Short FedEx Corp (FDX)

RED FLAG: The main driver of the difference between Economic and Accounting earnings is FDX's $11.9bn of off-balance sheet debt, a big number compared to $19.7bn in Net Assets and $25.6bn of market value.

by David Trainer, Founder & CEO

August 17, 20101Comments

Stock Pick of the Week: Buy International Business Machines (IBM)

HIDDEN GEM: Our detailed valuation model shows that IBM grew its "economic" profits more than it accounting profits during its last fiscal year. Economic profits rose by $1.15bn while accounting profits rose by $1.09bn.

by David Trainer, Founder & CEO

August 5, 201018Comments

Economic Versus Accounting Earnings

Accounting data was not designed for equity investors, but for debt investors. "Earnings, earnings per share and earnings growth are misleading measures of corporate performance."(from page 66 in The Quest For Value by Bennett Stewart, Harper Collins 1991.)

by David Trainer, Founder & CEO

August 3, 20101Comments

Stock Pick of the Week: Sell/Short Yahoo (YHOO)

Overall, the Risk/Reward of investing in Yahoo's stock looks Very Dangerous to me. There is lots of downside risk given the Misleading Earnings and there is little upside reward given the already-rich expectations embedded in the stock price.

by David Trainer, Founder & CEO

July 20, 20100Comments

Stock Pick of the Week: Sell/Short Whole Foods Market (WFMI)

One of the Most Dangerous Stocks for July, Whole Foods has misleading earnings and a sky-high valuation, in our opinion. The same is true for all of our Most Dangerous Stocks.

by David Trainer, Founder & CEO

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