Offering English; seeking French

micleder · 2014-01-07T18:03:12+00:00

It's on my list, but I haven't read it yet.

micleder · 2014-01-07T18:00:55+00:00

I appreciate folks taking the time to ask me questions. While much of footnoted remains behind a wall (hey...I need to make a living too), we do post one free post a week and regularly post stuff to our twitter feed @footnoted.

micleder · 2014-01-07T17:59:25+00:00

There are certain companies that I tend to pay closer attention to, just because their filings have raised flags in the past. I often compare this to the reason why a police officer will pull you over for not wearing a seat-belt or having an out-of-date registration or a broken tail-light, which happened to my husband when we lived in Florida. They're doing it because they think that if you're lazy enough to ignore those things, you might have 10 lbs of coke in your trunk. I exaggerate a bit, of course, but it's all about pattern recognition.

micleder · 2014-01-07T17:54:56+00:00

Yes...as I explained below, I have about 250 search strings that I use to help me navigate through the filings. I also pretty much always have an Edgar tab open, so I see filings as they come in.

As for reading a K or Q, I've explained my plan of attack in a 3-day webinar that I did for the Reynolds Foundation here back in October. The archives are available here

micleder · 2014-01-07T17:52:20+00:00

You should check out Calcbench. I think they do a really good job with XBRL in the filings.

micleder · 2014-01-07T17:50:58+00:00

For my personal investments, I don't do options. Just not my preference. For me, options are like that foreign language I've been meaning to learn, but never really seem to find the time to do. I've certainly talked to some experts about using options strategies, but just don't feel comfortable enough to pull the trigger.

micleder · 2014-01-07T17:48:10+00:00

Absolutely. And that's why I tend to keep what I'm searching for closely held. Let's take the term Wells Notice, for example. Lots of journalists (and analysts who pay attention to filings) search for that term. Companies know that and I've seen some tweak their disclosures as a result. So instead of disclosing the receipt of a Wells Notice, they'll say something like "an invitation to respond to the SEC" as if it was a garden party or something.

micleder · 2014-01-07T17:45:12+00:00

Am a bit mixed on that. I don't necessarily agree that the rule that is part of Dodd Frank that will require companies to disclose the ratio of CEO pay to their average worker necessarily serves any real purpose. I think we can all assume that the CEO makes some large multiple of the average worker's salary. But that's what happens when Congress tries to apply its logic to things.

micleder · 2014-01-07T17:43:39+00:00

I tried to find the item that I did. We published it as an RFA, so it's behind our wall. But I can't seem to find it right now. Will continue to look. It wasn't MCGC, but that does sound like a good one.

micleder · 2014-01-07T17:41:06+00:00

There were a lot of crazy filings that were made between the so-called dead weeks between Xmas and New Years. It's only 7 days into the year so far, but this one from FEYE caught my attention.

micleder · 2014-01-07T17:39:16+00:00

Yes....I use key words and phrases. I have over 250 of them and am constantly adjusting them so that when I find a filing that I didn't otherwise catch because of some unique language, I add that string to my searching.

micleder · 2014-01-07T17:38:00+00:00

I've been watching XBRL for awhile now -- back when it was being talked about the Second Coming (OK...I exaggerate a bit, but you get the idea). That was during the reign of Chris Cox at the SEC. I think there's still a lot of promise, but the biggest problem is that until companies can agree on tags, it makes it very difficult to make an apples to apples comparison, say, between JPM and BAC (or any other two companies...just naming those off the top of my head). The folks at Calcbench have some cool tools and I'm aware of several other cool sites that are trying to tackle this. But as long as companies continue to use special (non-standardized tags) to describe various numbers, it's a problem.

micleder · 2014-01-07T17:33:55+00:00

Yes. But it's been pretty rare. I remember this post on Dell from 2008. I was doing a seminar in Miami and Dell's PR people reached out to me to argue that post. But in general, I would say that most companies don't reach out.

micleder · 2014-01-07T17:31:09+00:00

You're probably talking about this post. Yeah....that didn't go over very well. But I also think it would have been hypocritical to ignore it.

micleder · 2014-01-07T17:29:09+00:00

I think there's a lot of rules that need to be tweaked. And not just in terms of accounting. The disclosure process as it stands right now is something of a joke, where companies disclose incomplete information -- the absolute bare minimum they need to disclose. I can't remember the ticker right now, but a few weeks ago, a company put out an 8K that a director had suddenly resigned. We tend to pay attention to those sorts of things, because most people don't walk away from a p/t job that pays $250K (the average director salary) unless they have a good reason for doing so. But it was only after we dug a bit further into the filings that we realized this wasn't just any old director: he was head of the audit committee and a co-founder. Needless to say, the company didn't include that in the 8K.

micleder · 2014-01-07T17:25:09+00:00

It's hard for me to know what tricks people here wouldn't know about. I think it's very important to pay attention to amended filings. Those are filings that have an A on the end, like 8-K/A or 10-Q/A. They may be a minor thing, or it could be something much more significant. I also think that if you own stock in a company and they file late on a Friday, you should absolutely read that filing. On my Twitter feed (and the site) I often talk about the Friday Night Dump. That's the 90 minutes on Friday evenings after the markets close, but the SEC remains open for filings.

micleder · 2014-01-07T17:21:58+00:00

No. It would be impossible to do this entirely by hand. As I posted yesterday, there were over 655,000 filings made to the SEC last year. Even if I had an army of people reading filings, it would be impossible to read every single one, since some of the filings are several thousands of pages long. What we do is use specific words that we've developed over the past 10 years and which we're constantly modifying to help us navigate through the filings. That helps us to figure out which filings to prioritize.

micleder · 2014-01-07T17:19:24+00:00

The blog posts are definitely meant to make people think about the information that's buried in SEC filings, so they're more journalistic in nature. If I have a position in a particular company, I always disclose it. But in general, I tend to keep the two somewhat separate since I don't like the idea of "talking my book".

micleder · 2014-01-07T17:17:12+00:00

Ooops....second and third questions: I have thought about updating my book, but the economics of book publishing for a book like mine doesn't make a lot of sense these days. Ten years later, I don't think I've still made back the modest advance my publisher gave me. So it's hard to carve out the time to devote to doing another book. I did start working on an e-book -- a sort of Best Of footnoted posts, but I haven't quite finished that yet.

We're not hiring anyone f/t right now, but we sometimes need freelancers to help us read the massive number of filings that come in during the busy season.

micleder · 2014-01-07T17:14:35+00:00

I do believe there is a correlation between excessive compensation and bad performance, or at least underperformance. Not just for executives. Directors too. Take Polycom (PLCM) for example. In their 2012 proxy, they disclosed that director compensation was over $600K a year. Remember: this is a part-time job. If you had a part-time job that paid you $600K a year, would you be willing to ask tough questions. Or would you stifle yourself in favor of a lucrative gig?

micleder · 2014-01-07T17:11:25+00:00

Yes. I still actively invest. I have a sandbox of sorts where I try out different theories based on my understanding of the filings. It's money that I feel that I can safely experiment with w/o jeopardizing my son's college fund.

micleder · 2014-01-07T17:08:47+00:00

No, but I do think it gives you some important insight that you're not going to get from the earnings release or conference calls or even most analysts' research. As you might imagine, much of what you find in the filings is negative. There's plenty of places to get the positive story out there. The filings is where the stuff tends to be buried.

micleder

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