Presentation Transcript

1. Fundamental Analysis Series
2. Fundamental Analysis Series http://www.investopedia.com/video/play/understanding-fundamental-analysis Ben Freeman

3. Reports

4. Why? The best part about these online investor relations sections is their extra nuggets of hard-to-find information. For example, most companies will use these spaces to offer detailed info on past acquisitions and stock splits not always available on other financial portals.
5. Annual Report 1. An annual publication that public corporations must provide to shareholdersto describe their operations and financial conditions. The front part of the report often contains an impressive combination of graphics, photos and an accompanying narrative, all of which chronicle the company's activities over the past year. The back part of the report contains detailed financial and operational information.
6. Annual Report (cont.) -Financial Highlight -Letter to the Shareholder -Narrative Text, Graphic and Photos -Management's Discussion and Analysis -Financial Statements -Notes to Financial Statements -Auditor's Report -Summary Financial Data -Corporate Information
7. 10-K 10 K- A comprehensive summary report of a company's performance that must be submitted annually to the Securities and Exchange Commission. Typically, the 10-K contains much more detail than the annual report. It includes information such as company history, organizational structure, equity, holdings, earnings per share, subsidiaries, etc. The 10-K must be filed within 60 days (it used to be 90 days) after the end of the fiscal year.
8. 10-Q A comprehensive report of a company's performance that must be submitted quarterly by all public companies to the Securities and Exchange Commission. In the 10-Q, firms are required to disclose relevant information regarding their financial position. The form must be submitted on time, and the information should be available to all interested parties. The 10-Q is due 35 days (it used to be 45 days) after each of the first three fiscal quarters. There is no filing after the fourth quarter because that is when the 10-K is filed.
9. Where do I find these things? Schlumbeger http://www.slb.com/ http://www.sec.gov/edgar.shtml
10. Which is Best? 10-K The 10-K is the black and white, no color pictures document that is submitted to the SEC. Very often, a business will simply file the 10-K as its annual report since that document is mandatory for every public company Think of the glossy annual report as informative marketing material
11. Structure Item 1: Business - a description of the company's operation Item 1A: Risk Factors Item 3: Legal Proceedings Item 6: Selected Financial Data Item 7: Management's Discussion and Analysis of Financial Condition
12. How to effectively read investors should always read them with a sense of skepticism Step 1.) Read Business, Item 1 Step 2.) Read Item 6 and 7 and examine and analyze the financial data How has the company performed over a period of years? Compare the income statement with the cash flow statement for any red flags.
13. How to effectively read Step 3.) go back and read the risk factors section and the legal proceedings section to determine if any hidden surprises may lurk beneath the surface focus on any unusual risk factors, such as if the company generates a substantial portion of its revenues for one or two customers Keep in mind the size of the company when reading legal proceedings
14. Info taken from http://www.investopedia.com/articles/basics/10/efficiently-read-annual-report.asp