At the Fool:
Rule Breaker Portfolio, Drip Portfolio, Research
In doing research, I first go right to the source: the bottle. No, wait. I mean a company's SEC documents. Legal SEC documents are arguably the best place to obtain comprehensive, raw information about a company's operations. Objectively speaking, I find that these SEC documents are presently most amicably on the Fool because, at Fool Quotes & Data, each SEC filing for every company is arranged by table of contents (balance sheet, income statement, etc.) rather than as a giant, sprawling document like on most sites. I also rely on company websites (the company being written about and its competitors) for information, and on the Fool discussion boards (thank you Fool community!) for smart analysis, good questions, timely discussion of events and the occasional flame. I also do a Motley Fool site search to see past articles written about a company. For comprehensive company information and Foolish analysis all in one place, I read Motley Fool research reports. Finally, I sometimes read other research reports obtained mainly on Multex for still more opinions. -- Jeff Fischer
News & Commentary, Research
The first step in researching is actually finding out what companies are out there. This is a highly informal process for me, and I typically find new ideas by chatting with my Foolish chums or by reading the Fool News. After hearing or reading about something I find interesting, I normally head straight to the company website to try to figure out what the company does and how they make money. Then, like most other Foolish analysts, I go straight for the SEC filings. This is where I find the most "meat" for my research. The filings that interest me the most are 10-K (annual report) and 10-Q (quarterly reports). After doing lots of reading and number crunching from these forms, I fill in any holes I may have by calling the company's investor relations and/or listening in on the quarterly conference calls.
News & Commentary, Research
Dig deep and ye shall find. While I love to check out company news, websites and SEC filings, the real joy of the Internet comes in what isn't so readily available. That's why I love the Motley Fool message boards . Naturally you ferret out what can't be substantiated. But where else are you going to be able to round up a collection of employees, investors and outsiders, to form an interactive community? Another source I love is Company Sleuth. Beyond linking to our own message boards you can check out SEC filings and also domain name and trademark registrations. See what the company is doing today. Do some logical connecting of the dots. And you can see where the company plans to be tomorrow.
Research
When I am searching for information about a company or its competitors, I go right to the SEC documents and the company Web pages. I suspect that most people do not read the SEC filings. I like to take a look at the last couple of 10-Q's and the last 10-K at least. Not only are the financials useful, but the text provides some good clues about how the company markets its products, where it competes, and how much management is compensated. I also like to read the last few shareholder letters in the annual reports if possible. Anything glossy usually has an element of marketing to it. But, over time, you can get a feel for how the management of a company expresses itself when things go wrong. Does management clam up, or does management openly admit to the problems? I like to talk with investor relations if possible. Usually I come up with a few questions I would like answered that I cannot find elsewhere. I also like listening to conference calls. Occasionally, an analyst asks an intelligent question rather than the usual "great quarter guys." I also like reading a variety of magazines that talk about what a company is doing in the marketplace, not from an investment perspective. Last but not least, the Fool message boards provide good insight into a company. There are plenty of smart folks out there in cyberspace.
News & Commentary
One very handy resource that I use when I'm researching a company is its own website. Some are better than others, of course, but I almost always find a bunch of useful information there. Without using a search engine, you can often correctly guess the Web address. If you're looking for the Sears site, try www.sears.com. For General Electric? Try www.ge.com. (A few are tricky, though. For instance, www.gap.com will take you to Gap's online store, but www.gapinc.com will take you to the corporate site.) Try CompaniesOnline for any you can't find. Once at the site, look for links titled "About Us" or "Investors" or "Our Business." At a company's website, you can learn all about the various products and/or services it offers, read about the company's history (often quite interesting and full of fascinating tidbits!), and you can usually access recent news releases and financial statements as well. Many companies permit you to view and download their annual reports right from their own website -- no more having to call and wait a week or longer for this info. Some companies will include an extensive stock price and dividend history, too, and information on their dividend reinvestment plan, if they have one.
Drip Portfolio, News & Commentary
In researching a company for a Fool News story or a potential investment, I'll almost always take the initial step of reading the company's latest 10-K financial filing for a basic overview of what the company does and what it's numbers look like. I typically use FreeEDGAR, but pretty much any SEC filing site will do the trick. It's amazing how much information you can find out about a company by reading this single document. For more depth, I'll also read past quarterly reports (10-Q's) to see how the business has progressed over time. If a company is really interesting, I'll then read the 10-K's and 10-Q's of its main competitors. If it's really, really interesting, I'll read the 10-K's and 10-Q's of the firm's major suppliers and customers as well. Follow this system often enough with new companies, and you'll learn just how vast -- and interconnected -- the universe of stock investment possibilities really is.
Rule Maker Portfolio
I won't research any company without first reading through the business description from the 10-K. It's just chock full of good information about how the company operates and the environment in which it competes. I also check out the company's financial data for a number of quarters and years. FreeEDGAR is my favorite source for all SEC documents, as I Iike the way it breaks them down into component parts. I usually make my decision to research a company over a period of time, which means that by the time I actually study it, I've accumulated a lot of information on the company by reading various Fool message boards, scanning news headlines at sites like the Fool, Yahoo! Finance, and San Jose Mercury News. I also check out the company's website and read research reports, which I find either on Multex or in the investor packages that companies send out. I also find lots of good information in industry specific magazines. Some of my favorites for tech companies are PCWeek, InfoWorld and Inter@ctive Week. Finally, I like to listen to conference calls when I can. Sometimes I find the Wise ask good questions, but more importantly, they give me an opportunity to hear members of the management team speak. That's very important to me, as I believe the most important thing we're showing when we purchase shares is a belief in management and its ability to execute its strategy.
Research
There are certain sources that are indispensable for an analyst. The first three that come to mind are FreeEDGAR, which gives access to SEC filings, the company's website, and the Fool message boards, of course. However, they don't have everything I like to use. It's always good to look at the news articles from the past year. Unfortunately, I haven't found the perfect site yet, so I use the Fool's News and headlines areas, Yahoo! Finance, PR Newswire, Business Wire, and whatever else I can find. One of the more useful news searches I use is to just run the company's name through a service like Google. Obviously, this is going to generate a googol of hits (a 1 followed by 100 zeros), so you have to try to limit the search somehow. This accomplishes two critical goals for me: it helps me find industry publications and it helps to find local newspapers. Industry publications are great because they give you information on, well, the industry, including customers and suppliers of the company I'm researching. But, local newspapers can be real diamonds. For some reason, local papers seem to get better access to companies than national organizations. So, you can find out about hiring and firings, future plans, and other key points. Yikes, I just gave out my secret!
News & Commentary
When I want to learn more about a company, I start by visiting the company's website. A good website will give me a general overview of the company and its various lines of businesses, its history, bios of top management, as well as links to recent press releases, earnings announcements, and annual reports going back a few years. For an outside perspective, I visit Hoover's Online and read the company profile (I tend to ignore the financials here as there are better sources for this). For well-publicized companies, I also do a search on Wall Street Journal Interactive. I also see if Fortune has done a recent cover story or profile. Finally, for the real nitty gritty, I go to EDGAR Online and download the most recent 10-K filing, which details the company's business model and performance, and financial statements going back as far as 10 years. My favorite section is the part where the company discloses the potential risks to the business -- very helpful in assessing the company's weaknesses.
Special Features
Before looking into a company's balance sheet and income statements, I'll begin by asking myself one question: "Is this a company whose products I know, use, and love?" If I answer myself with a "yes," then I'll go ahead and dig deeper. I start by reading recent news on the company at the Fool and through Yahoo! Finance. This is a way for me to become immediately familiar with what's been going on at the company recently. Next, I like to read through some messages on that company's message board here at the Fool. Here, I can gain insight into the company through current investors' concerns and opinions. I then run the company through the Rule Maker criteria.
Elsewhere:
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News & Research Sites:
SEC Documents
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