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Strategies & Market Trends : Due Diligence - How to Investigate a Stock -- Ignore unavailable to you. Want to Upgrade?

To: jbIII who wrote (2)	3/25/1999 9:40:00 AM
From: Don Pueblo	Read Replies (3) \| Respond to of 752

There can be a lot of value in calling a company, if the company trades on the NASDAQ or the NYSE or some exchange. Reputable companies maintain Investor Relations departments, and they are the people that send out the news. I always ask the IR person how they like working at the company. If they hesitate, or don't seem enthusiastic, I note it. The deal is, most companies have enough information available on the Internet so you really don't need to chat with the IR person much. You ask for the latest 10Q or whatever, and off you go. If you are talking about a Bulletin Board stock, I personally would not bother calling the company. Bulletin Board stocks don't have to report anything. Seems to me that if they wanted to get some news out, they would report their revenues in an audited statement or something like that. I don't understand why they don't. I don't understand why a legit business would bother to get onto the BB. Getting onto the NASDAQ is not that hard, despite the BS that the BB dillweeds tell you. If you do call a BB company, and you are told that their PR is handled by an outside firm, my suggestion is to move along fast. I'll be posting a bunch of stuff on investigating BB stocks later. And by the way, if anyone is interested in how much money these insiders in BB deals can scrape off the sheep, and how they can do it, take a few minutes and read this: sec.gov

To: jbIII who wrote (2)	3/30/1999 1:50:00 AM
From: EL KABONG!!!	Respond to of 752

jbIII, Just found TLC's thread, so I'm just catching up now. If this has been answered before, I apologize now. But I just love expressing my opinions. <g> What value is there, if any, in "Calling the Company"? This is one of my favorite questions. I get asked this one a lot by investment club members. In my opinion, there is no reason to call the company anymore. In the old days (before the internet), you might have to call investor relations to get an investor's packet sent to you. This usually consisted of the prior year's annual statement, the current year's 10Qs and some recent press releases. Some companies would even include some statements by analysts that covered their stock. But today, all of that information (and much more) is available on the internet, and most of it is free. Of course, we're talking here about reporting companies on one of the major exchanges like NYSE, NASDAQ or AMEX. We're definitely not talking about the OTC-BB or the pink slips. If you look around SI for awhile, you'll find that many of the big companies that slipped up were first found out by internet posters, not auditors or accountants or analysts or the major news media. The most recent example of this that comes to mind is Micron Technology (?), where SI posters uncovered the inconsistencies between press releases and the company's annual report. Calling a company on the OTC-BB or the pink sheets is a total waste of time. All of these companies have two stories to be heard. The first tale is the one the company tells. It is usually rah-rah type stuff, glowing reports, glowing prospects, glowing promises, success by associating their name with a big company that never heard of them (leeching), and so on. The other story is the one you have to find for yourself. It may involve digging into the past history of company officers and directors, sometimes a very sordid affair. It may involve some forensic accounting. It will be hard work. When you call the BB company you're going to hear the story the company wants you to hear. Almost always, that information is available elsewhere, in press releases or on the threads. A company insider isn't going to give you the inside scoop that hasn't already been carefully considered. If an IR/PR guy or an insider does give you what seems to be relevant information, ask yourself why this isn't public information already. Do you really think that they would give you inside information, even in error? If you post it, and it later turns out to be wrong, the company will merely claim it misunderstood you or you misunderstood their answers. Telephone calls are neither reliable or verifiable. And that word is the key. Verifiable... All information from a BB company should be independently verifiable or you should disregard it, no matter how favorable to the company's story. The real story with BB companies is to check, double-check and independently verify everything they say. Everything. Watch the wording in press releases. Almost always, the wording is deliberately vague and misleading, giving the casual reader the impression of great things to come, but in reality, the company has actually cloaked the promises in vague semantics. Currently, BB companies are either non-reporting, reporting but unaudited, or reporting and audited. Watch the auditor and make sure it's a reputable firm, not the CEO's brother-in-law. Remember, you cannot possibly independently verify anything in a telephone call to the company. KJC

To: jbIII who wrote (2)	6/9/1999 11:35:00 PM
From: The Other Analyst	Respond to of 752

Why call the company? Very simply, if you really want to understand the stock you have to know what "the world" believes, i.e. what is in the stock price. If you know something the world doesn't, great. But the company (usually IR person) talks to lots of investors, and if you don't know what the company is saying, you don't know if your information is already in the market or not. Or were you asking a different question, such as Why believe the company? That is a different question.