somebody asked me, on a random stock board
what books ti read to get better at reading an sec filing, and doing actual fundamnetal analysis.
using a case in point, i replied,
sec.gov.
reading filings.
on f/a..grahame&dodd…… sigh.
which will tell u to not get near btim, et al..so does not apply.
as i have said before, this is a “story stock”..and the dd is thence all about the story.
u are telling one to urself about future earnings. i am looking for a basis for such that can be measured (in f/a terms) plus some insane multiple to allow for hype.
(peter lynch tells the story of in the late 80’s going to japan over and over, looking to invest there..and always seeing evvvvverything overpriced.. and still going up… but then, one fine day, or 1/4…
http://finance.yahoo.com/q/bc?s=%5EN225&…
whatever u can find by lynch will be eminently readable. and whatever u can find by either adam smith, or that matter, das kapital (u probly want the translation…:-) ).
within those contexts:
1: why does btim keep frontloading filings? (giving data for periods after the reporting period).
2. why does btim not state, transparently, terms of financing?
3. why does btim keeeeep using warrants?
4. why is the patent estate not identified in filings?
5. how many units of cells must be sold to meet g&a, and cog? (i’m ignoring r&d)
what is the present mkt for such?
what is a reaonable growth rate in that mkt? 40% y/over/y? 60%
how come?
who are the cmpetitors?
can they indercut the price?
what >unique< advantage does btim have?
what s mangemtn’s track record at creating value for shareholders?
what is the track record of failures??
(failure is not a problem by itself…annny “story” stock will have plenty.
what do the >filings< ..not the press, say about that?
this entry is not about btim:ob.
it is about how to think about what you hear.
right now, i am sitting sipping some “expensive” coffee–that is, expensive in comparison to the rancid garbage from a folger’s can. this stuff retails for $27 a pound. how does it do that? by having desirable qualities that other coffees do not. it has a niche, which has grown, and can be supplied consistently.
any stock you are told about, no matter what the sector, intends to fill a market in a definable niche, in a better, more cost effective, or more widely distributable way.
if the filings and the company history do not show growth towads defined goals faster than the price is growing, it’s overvalued.
it might be a whore stock to trade. you might get affectionate about it, and want t take some home.
before u do, check for crabs. “crabs” in this case include terms like “about to” “beginning” “development stage” and most important…”debt.”
as the events of the last year show, debt does not go away.
debt/equity swaps are great…if u are on th low sde of the basis in your own postion. nothing to be afraid of. it showsthe financers still beleive in the ticker.
ever heard of rand mcnally? sure you have. for about 1/2 a century it was traded on the pink sheets. thus, if a ceo says a biz plan goal is to get onto a major exchange–be wary.
if the stock can’t get above 4 based on revenue potential seen by a broad market, what is the ceo going to do??
hehe…you don’t wanna know…or actually, you do, since u will either be able to trade the media game, or get traduced by it.
sec filings are in plain english. if they don;t seem like it, be careful.
Posted under business
This post was written by admin on August 20, 2009
