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operating leases

ICYMI
February 17, 20230Comments

ICYMI: Long Idea EPS Update, Model Portfolios Outperform in 2022, Improving our Models, #1-Ranked Stock Picker in February & Model Portfolio Update

Here's what happened at New Constructs this past week.
by Kyle Guske II, Senior Investment Analyst, MBA
Update to our Site
February 10, 20230Comments

Updating Our Models to Close New Off-Balance Sheet Debt Loopholes

We’re updating our models to ensure they capture all liabilities related to operating leases, both on and off-balance sheet.
by Kyle Guske II, Senior Investment Analyst, MBA
ICYMI
May 28, 20210Comments

ICYMI: Long Ideas, New Trick to Hide Debt, Figs Is a Standout IPO, Alerts for Credit Ratings, Our Keynote Speech for the E&Y Global Blockchain Summit, Sector Fundamental Trends & Model Portfolio Updates

Here's what happened at New Constructs this past week.
by Matt Shuler, Investment Analyst II
Danger Zone
May 24, 20210Comments

A New Way to Hide Debt…Again

“Non-Commenced leases” are the new version of operating leases, an accounting loophole that companies used to hide debt off-balance sheet prior to ASU 2016-02.
by Kyle Guske II, Senior Investment Analyst, MBA
Danger Zone Podcast
May 24, 20210Comments

Podcast: Why This Accounting Loophole & the Companies Using It Are in the Danger Zone

CEO David Trainer sat down with Chuck Jaffe of Money Life to talk about our Danger Zone pick this week: A New Way to Hide Debt…Again.
by Kyle Guske II, Senior Investment Analyst, MBA
ICYMI
May 14, 20210Comments

ICYMI: 3 Long Ideas in a Volatile Market, 3 Stocks To Sell, Avoid Squarespace’s Direct Listing, Fox Business Interview, Operating Lease Disclosure Red Flags, & Model Portfolio Updates

Here's what happened at New Constructs this pas week.
by Kyle Guske II, Senior Investment Analyst, MBA
Danger Zone Podcast
October 5, 20200Comments

Podcast: Why Operating Lease Disclosures Are In The Danger Zone

CEO David Trainer sat down with Chuck Jaffe of Money Life to talk about our Danger Zone pick this week: Operating Lease Disclosures: Best & Worst Practices.
by Kyle Guske II, Senior Investment Analyst, MBA
Danger Zone
June 27, 20190Comments

Danger Zone: Misleading Operating Lease Discount Rates

The new operating lease rule is not perfect. These companies use unusually high discount rates to reduce and, perhaps, understate their reported operating lease burden.
by Sam McBride
June 27, 20190Comments

Podcast: Why Operating Leases Are in the Danger Zone

Investment Analyst Sam McBride sat down with Chuck Jaffe of Money Life to talk about our Danger Zone pick this week: Danger Zone: Misleading Operating Lease Discount Rates.
by Kyle Guske II, Senior Investment Analyst, MBA
February 27, 20190Comments

New Accounting Rules Bloat Balance Sheets in Today’s Filing Season Find

From yesterday's research, our analysts parsed 79 10-K filings and collected 8,899 data points. In total, they made 1,844 forensic accounting adjustments with a dollar value of $854 billion.
by Kyle Guske II, Senior Investment Analyst, MBA
December 13, 20180Comments

How Debt to Equity Can Mislead Investors

Millions of professional investors will soon see over $3 trillion in new debt added to corporate balance sheets, which will affect some stocks and sectors much more than others.
by Sam McBride
Danger Zone
October 22, 20180Comments

Danger Zone: Investors Who Ignore Accounting Rule Changes

Investors that don’t pay attention to this accounting rule change are taking on unnecessary risk by mistaking an upcoming change as a fundamental change in these businesses.
by Sam McBride
April 23, 20184Comments

The Impacts of Operating Leases Moving to the Balance Sheet

The Financial Accounting Standards Board (FASB) introduced a new accounting standard (ASU 2016-02) that requires companies to recognize operating lease assets and liabilities on the balance sheet.
by Kyle Guske II, Senior Investment Analyst, MBA
December 2, 20152Comments

Why Earnings Manipulation Is Highly Contagious

Why are earnings misstatements so contagious? Learn why these misstatements occur and warnings signs of when a company may be likely to partake in the manipulation of earnings in this special report.
by Sam McBride
November 17, 20151Comments

10 Land Mines From New FASB Rule For Off-Balance Sheet Debt

Last week, the Financial Accounting Standards Board (FASB) voted to update standards on operating lease accounting that would force companies to record as much as $2 trillion worth of lease obligations on their balance sheets.
by Sam McBride
New Constructs
December 29, 20142Comments

What Are Operating Leases and How Do They Affect Earnings?

Find out how over 75% of companies are hiding billions of dollars of off-balance sheet debt from their investors.
by Kyle Guske II, Senior Investment Analyst, MBA
September 10, 20140Comments

How to Value a Stock, Step 2: Invested Capital

The second step to gauge the value of a company is to determine the sum of all cash that has been invested in a company over its life without regard to financing form or accounting name. We call this Invested Capital.
by David Trainer, Founder & CEO
New Constructs
September 10, 20130Comments

Discussing FASB’s Lease Proposal

On August 27th, I met with my fellow members of the FASB’s Investor Advisory Committee (IAC) to discuss the proposed treatment of operating leases on the balance sheet by the Financial Accounting Standards Board (FASB).
by David Trainer, Founder & CEO
New Constructs
July 15, 20132Comments

FASB/IASB Considers Adopting Revised Rules for Operating Lease Accounting

We applaud the Financial Accounting Standards Board's (FASB) latest proposal to change the way leases are reported. The new rules would make only the shortest-term operating leases exempt from being recorded on the balance sheet.
by David Trainer, Founder & CEO
June 24, 20137Comments

Implied Interest For Operating Leases – NOPAT Adjustment

NOPAT Adjustment for Implied Interest For Operating Leases. Converting GAAP data into economic earnings should be part of every investor’s diligence process. Performing detailed analysis of footnotes and the MD&A is part of fulfilling fiduciary responsibilities.
by David Trainer, Founder & CEO
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