We believe the decision to buy or sell a security is based on whether the underlying risk or opportunity is correctly reflected in the company’s valuation. A detailed analysis of the disclosure and accounting choices made by management provide insight into risks that may be unknown or underappreciated by the street. We work with intrinsic values calculated using discounted cash flow models and our recommendations incorporate five key analytical categories:
Accounting and Disclosure
Accounting rules have become increasingly complex. We help clients navigate through accounting choices made by management to provide insight into the quality of earnings and operating performance.
The market often loses sight of fundamentals and gets caught up in the ‘story’. Our analytical techniques ensure that the ‘story’ is supported by the facts.
Understanding how an executive team is compensated provides insight into a company’s business objectives and accounting choices.
We have learned that nothing in accounting happens without a reason and that understanding a company’s approach to accounting and executive compensation enables us to more accurately measure shareholder value, the overall quality of management, and provides insite into an organizations internal controls.
Balance Sheet Risks
Time and again, accounting scandals and unexpected losses prove that what is ‘off’ balance sheet is often more important that what is ‘on’ balance sheet. It is only after a thorough understanding and review of financial disclosures that such exposures can be uncovered.
Cash Flow Sustainability
Companies go bankrupt because they run out of cash, not earnings. Cash Flow sustainability is the key to operational health.
Our Research Process Uncovers What Others Don’t
The following is a list of our reports published to support your investment decisions:
Material news, trending reports, accounting updates, client outreach & top ideas