All Red Flags Waving!

As an investor, it's essential to sort out the good companies from the bad, and the clues you'll need are in the financials. Join author Tom Jacobs as he raises the red flags of financial chicanery. Avoid and even profit from companies committing scandalous accounting.

Check out the rest of the videos in this series:

What's Behind the Numbers: Learn Red Flags, Avoid Blowups
Red Flag 1: Too Much Inventory, Writedown Ahead?
Red Flag 2: Are Stock Options Making the Cash Flow Fake?
Red Flag 3: Serial Acquisitions: Apples to Oranges
Slay Your Fear of Shorting: Use Put Options to Know Your Risk

Red Flag 4: Collecting the Revenue: Too Many Days' Sales Outstanding?

With so much of the financial industry getting bad press these days, it may be a "be greedy when others are fearful" moment. Not surprisingly, some of Warren Buffett's biggest investments are in the space. In the Motley Fool's free report, "The Stocks Only the Smartest Investors Are Buying," you can learn about a small, under-the-radar bank that's too tiny for Buffett's billions. Too bad, because it has better operating metrics than his favorites. Just click here to keep reading.


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  • Report this Comment On March 28, 2013, at 6:35 PM, MonsterFluff wrote:

    JEC did not stay collapsed--now back at a 4-year high

    JEC is essentially a decently run engineering company with little to no evidence of managed earnings and cash flow accounting. The nature of the business and revenue recognition makes for some uneven results and they hit a particularly nasty patch during the time you and DelVecchio were shorting. They have since recovered from the implosion with a string of new contracts as their clientele begins to spend. They have trouble generating outsized amounts of revenue in good times and bad because they tend to go after the small projects and the maintenance work that are largely ignored by b the bigger boyz like Fluor. These smaller clients dry up and cut back severely in bad times while the whale projects may still go through and provide more spectacular results.

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