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.
In case you needed proof beyond the Global Research Settlement that Wall Street research cannot be trusted, Morgan Stanley delivers by admitting "inadequately disclosing conflicts of interest on the part of its research analysts."
A newcomer to our Most Attractive Stocks for July, this small cap stock has an excellent risk/reward profile, which earns it our highest Rating: Very Attractive.
Hidden Gem - GPS: economic earnings are rising faster than reported accounting earnings b/c the company lowered the capital employed to run the business. GAAP earnings do not capture increase capital efficiency of the business.
Most of the time when I meet with investors (large and small) and explain what I do and New Constructs does, they are astonished about what I explain as the reality of the investing world. They always ask: "What are regulators doing?"..."How can they allow these things to go on?"
The answers to that question are:
The best strategy for making money in stocks is "buy low expectations & sell high expectations." Sounds easy — but if it was easy, everyone would do it, right?