Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : Turnaround Plays -- Ignore unavailable to you. Want to Upgrade?

To: Robert Graham who wrote (150)	12/9/1997 7:52:00 AM
From: David Alan Cook	Respond to of 206

Bob, In almost all of the small cap stocks that I buy, I buy early. My first objective is to quantify my downside risk. I take a good look at the balance sheet of each company that I buy to try to determine if the company has time to turn its operations around. Good indicators are cash on hand, level of debt, current ratio, quick ratio, Interest Coverage etc. I always print out the latest SEC documents and call the company for an investor packet. After I recieve these documents, I review for problems. Most small cap stocks that I own have and / or still do have some type of problem ( pending lawsuit . . no earnings . . poor mgt ) My objective is to determine why the company is performing poorly and what indicators should one monitor for signs that the company has turned the corner. I then monitor those indicators. I always call the companies that I am investing in. This is a good source of Information IMO. I usually have a series of questions to ask management. I also call or visit suppliers and outlets of the company. If the company is undervalued against industry avg Price Ratios and Insiders have a good position in the company and/or buying shares, I start buying shares also. I will hold those shares as long as my reasons for investing in the company remian intact. For the larger companies that I do not have good access to, I tend to rely on technical indicators to determine buy and sell points. IMO smaller companies are less efficient than the larger companies. It is near impossible for me to reach a CEO of a large company. Some of the key indicators for turnarounds that I follow: 1) New product launch . . impact on revenue and earnings 2) Insider buying . . 13Ds 3) Cost Cutting 4) Revenue growth DC