Weekly Webinar 5/14: What Makes New Constructs’ Research Different

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In case you missed it, or in case you wanted to watch it again, here is our live webinar from this week. In it, CEO David Trainer compares stock reports by Morningstar, Zacks, and Capital IQ to our stock reports to show why we offer more in a single report than all of these other providers combined.

About The Author

Andre Rouillard

Investment Analyst at New Constructs

1 Comment

  • John

    May 15, 2015


    My perspectives on those comparative research products are that they are data dumps that the discount brokers supply to give the illusion of research. For me, services like ValueEngine don’t really provide a lot of value. S&P and Morningstar company reports provide some value but not from their financial metrics, which are again, data dumps. S&P provides a nice synopsis of news developments…kind of like the key developments section of Reuters that I find useful in framing a story around a company. Morningstar is useful in providing key pros and cons on businesses. Also, Morningstar offers 10K Wizard, which is a pretty useful product. Then there is Portfolio123, which very powerful in its screening and simulation functionality and is very valuable for backtesting. I would certainly recommend using P123 as a resource for screening and backtest development. However, the data input feed to P123 is another data dump and lacks the level of scrubbing as is done at New Constructs. Actually, no service offering is doing the detailed level of scrubbing that you have been providing…not even close. Valueline kind of does it a little. I’ve looked at Compustat, CapitalIQ, Factset and even CSFB’s HOLT. Your group at New Constructs is definitely scrubbing beyond all these providers. In addition, you are linking the output so that it can be traced to actual content in the original filing. This is a great internal auditing tool. The combination of scrubbing and retracement, for me, is unprecedented. Bloomberg offers retracement but not the same level of scrubbing. However, admittedly, Bloomberg has its place in terms of comprehensive financial/economic data across so many different areas of coverage. Still, it’s not really a household/retail service and very few people are going to want to put a Bloomberg terminal in their home office (or could afford to). Ycharts is another service that is kind of nice in providing economic data on top of fundamental data and offers some off-balance sheet items…but still incomplete…kind of like a slightly watered-down version of compustat/Bloomberg. In the end, I wouldn’t be spending my time at New Constructs if it wasn’t so differentiating. This is really a game changer and has allowed me to form such a better investment analysis and overall strategy for my clients. You’re doing a complete paradigm shift in securities analysis that combines forensics with quantitative, fundamental analysis, or “forensic quantimental” analysis. I think B-Schools should make use of your product as I’ve talked with professors who have attempted to do something along these lines and indicated how hard it is to do the filing-to-EVA conversion (the XBRL thing hasn’t been standardized enough to permit this capability). What amazes me is how you did that accounting filing-to-economic reality conversion and be able to automate and standardize the output for an apples-to-apples comparison across firms. I’ve gone through your stuff, seen what you’ve done and it’s truly impressive. I wonder if the Big 4 even has something like this. I can tell you I keep shaking my head with amazement every time I get into the weeds of what you’ve done. Truly something remarkable…I think you’ve got the equivalent of Big Blue for securities analysis. It’s certainly accelerated my research capability by at least an order of magnitude and I’m using New Constructs as an integral part of my research process. Truly a paradigm shift for financial statement analysis. I’d like to see this thing go to international coverage. Also, maybe you could do something for the macroeconomy as an encore…perhaps some sort of grand unified field theory for investing. Looking forward to seeing what’s next.

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