Money money money..
August 31, 2011 6:09 PM Subscribe
Where do i find sound, reliable and clearly-presented information on companies for the purpose of intelligent investing?
1: Is there one perfect portal for this or do experienced people get this information from various resources?
2:Im not looking for investment advice, just facts and numbers to guide me along the way, i.e their financial statements
3:How do i find out that a company's market value is below the value of its assets? Is this in the financial statement and how do i extract this information from there?
4:I'm asking this because it is mostly left out in investment self-help books and the like
1: Is there one perfect portal for this or do experienced people get this information from various resources?
2:Im not looking for investment advice, just facts and numbers to guide me along the way, i.e their financial statements
3:How do i find out that a company's market value is below the value of its assets? Is this in the financial statement and how do i extract this information from there?
4:I'm asking this because it is mostly left out in investment self-help books and the like
Response by poster: Thank you!
I forgot to mention:
how do i find out about a companies hidden assets/liabilities?
and
what external factors should i be looking at and doing the maths with? You mentioned inflation which is good for starters.
posted by freddymetz at 6:20 PM on August 31, 2011
I forgot to mention:
how do i find out about a companies hidden assets/liabilities?
and
what external factors should i be looking at and doing the maths with? You mentioned inflation which is good for starters.
posted by freddymetz at 6:20 PM on August 31, 2011
Not sure what you mean by "hidden" assets and liabiltiies. A company's financial statements are supposed to fully represent its financial condition. Are you asking about how to do forensic accounting to determine if financial statements are hiding accounting fraud? If so, a good place to start would be to read Harry Markopolos' report on Madoff.
posted by dfriedman at 6:23 PM on August 31, 2011
posted by dfriedman at 6:23 PM on August 31, 2011
Response by poster: hmm... an example could be that a company has owned a property for 100 years and the hidden asset is the difference between acquisition costs then and now? Doesn't the company have to report the value at acquisition cost in the statements? If so, the difference in value would be "hidden".
posted by freddymetz at 6:28 PM on August 31, 2011
posted by freddymetz at 6:28 PM on August 31, 2011
Sorry, I'm not really following what you're asking. A company depreciates an asset over time (if physical) and its balance sheet is updated quarterly (at least in the US) to reflect that depreciation. If the asset in question is intangible (like software) its cost is amortized over time, and if the asset is a natural resource, its value is depleted over time.
It sounds like you need to take an Accounting 101 course before you try to parse companies' financial statements and glean investing insights from same.
posted by dfriedman at 6:32 PM on August 31, 2011 [1 favorite]
It sounds like you need to take an Accounting 101 course before you try to parse companies' financial statements and glean investing insights from same.
posted by dfriedman at 6:32 PM on August 31, 2011 [1 favorite]
Response by poster: Thank you, but doesn't a company always have some leeway in the valuation of assets and liabilities which could lead to an undervaluation of assets for example?
I don't want to go too much off track though, I'm still looking for the best resources to find this information in the first place :)
posted by freddymetz at 6:41 PM on August 31, 2011
I don't want to go too much off track though, I'm still looking for the best resources to find this information in the first place :)
posted by freddymetz at 6:41 PM on August 31, 2011
Financial statements are only one aspect of a companies health and future prospects. Management style and ethics, R&D expenditures and capabilities, potential competitors both public and private are some. But most of these you'll never be able to accurately judge without being on the ground 7/24/365 investigating it yourself. Even then, you'd risk being blind sided by some guy in a garage with a clever invention.
Investing is gambling. Invest at your own risk.
The way most people manage this risk is to invest in diverse markets and industry sectors instead of putting all ones eggs in the one proverbial basket.
posted by j03 at 7:19 PM on August 31, 2011 [1 favorite]
Investing is gambling. Invest at your own risk.
The way most people manage this risk is to invest in diverse markets and industry sectors instead of putting all ones eggs in the one proverbial basket.
posted by j03 at 7:19 PM on August 31, 2011 [1 favorite]
Check out your local university library for The Value Line Investment Survey or subscribe to it yourself. These guys have a longstanding rep for quality information. Their buy recommendations have historically been good too, although i haven't been following their recent history. (I'm assuming USA stocks)
I generally start investigating a company through the financial snapshots available via Yahoo! Finance, wikinvest or Google Finance. But you have to take this with an occasional grain of salt because, for example, Yahoo Finance assumes that dividends are paid out four times a year when some companies pay only twice or even once a year. Once i have a general feel for the numbers I go to the company website and get their financials.
As for hidden asset values, I think you're going to have to do most of your own digging on that. You would have to ask the finance dept of the target company about their assets and their valuations.
posted by storybored at 9:23 PM on August 31, 2011 [1 favorite]
I generally start investigating a company through the financial snapshots available via Yahoo! Finance, wikinvest or Google Finance. But you have to take this with an occasional grain of salt because, for example, Yahoo Finance assumes that dividends are paid out four times a year when some companies pay only twice or even once a year. Once i have a general feel for the numbers I go to the company website and get their financials.
As for hidden asset values, I think you're going to have to do most of your own digging on that. You would have to ask the finance dept of the target company about their assets and their valuations.
posted by storybored at 9:23 PM on August 31, 2011 [1 favorite]
Oh, forgot to mention, if you just want raw data and financials without editorial comment for US stocks. Then it's the EDGAR database you want.
posted by storybored at 9:27 PM on August 31, 2011
posted by storybored at 9:27 PM on August 31, 2011
This thread is closed to new comments.
posted by dfriedman at 6:12 PM on August 31, 2011