Top 3 Best Sources of Investor Information

SEC Filings, Analyst Reports and Company Websites

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Investors are inundated with information these days, from high level press releases to detailed SEC filings. But, separating the useful knowledge from the fluff can be very difficult. Press releases often ignore bad information and focus on the good, analysts have a notoriously bullish bias, and SEC filings can be difficult to parse for useful information amid the boilerplate legalese.

In this article, we'll take a look at the three best sources of investor information and how investors can use them to make informed investment decisions.

Reading SEC Filings for Investor Information

The U.S. Securities and Exchange Commission (SEC) requires most U.S. listed companies to report financial data, insider transactions and other material information in so-called SEC filings. By knowing how to find and analyze these SEC filings, investors can ensure that they are well informed and up-to-date on all of the most important developments.

Investors can find SEC filings in many places. The SEC's own EDGAR database is a quick and easy way to find any filings, while specialty services like SECFilings.com or EdgarOnline offer customizable alerts and other features.

Some important SEC filings to know include:

  • 10-K (Annual Report) - Annual reports provide investors with a detailed overview of a company's fiscal year, including financial statements and a discussion of the results by management in plain English terms.
  • 10-Q (Quarterly Report) - Quarterly reports provide a slightly less comprehensive overview of a company's quarter, but also include the quarter's financial statements and some management discussion.
  • 8-K (Current Event) - Current event reports are filed for any material events that affect the company, ranging from basic press releases to new partnerships.
  • Form 3, 4 and 5 (Insider Trading) - Insider trading reports provide investors with notifications whenever company insiders purchase or sell shares, which can be an important indicator, especially when done outside of stock plans.
  • Schedule 13D and 13G (Institutional Investment) - Institutional investment reports provide investors with notifications when an institutional investor (such as a hedge fund or mutual fund) acquires a significant stake, which can be very helpful for investors.

International investors have it a little harder. While many American Depository Receipts (ADRs) file regular SEC filings, some file foreign issuer reports. And foreign stocks trading on non-U.S. exchanges often file only with their own country's regulatory body. Unfortunately, these filings may appear in foreign languages and can be much more difficult to analyze than SEC filings.

Two common foreign SEC filings include:

  • 20-F (Annual Report) - These annual reports are filed under U.S. GAAP principles, which can make them easier to understand and compare with U.S. companies.
  • 6-K (Quarterly/Current) - These are the foreign version of 8-K reports, which also tend to include 10-Q-type information for most ADRs.

Some common foreign regulatory bodies include:

Investor Information on Company Websites

Company websites can contain a wealth of information about a company, from financial statements to presentations.

And company websites can be much easier to navigate than many government agency websites when looking for financial information. This is especially true for international investors looking for information.

The most important things to look for include:

  • Financial Statements - Sometimes finding financial statements for foreign companies is much easier using their website than the country's filing system.
  • Company Presentations - Company presentations can provide a great overview of past performance, as well as projections for the coming quarters or year.
  • News/Press Releases - Company news and press releases can contain a wealth of information about day-to-day operations and financial performance.
  • Contact Information - Investor contacts, such as Investor Relations Officers, can be a great resource for investors looking for something they can't find elsewhere.

    Analysts as a Source of Investor Information

    Stock analysts can be a great source of information for investors. While sell-side analysts may be biased at times, they still offer some valuable information in a single location. This makes research a lot easier, especially for international investors. Meanwhile, buy-side analysts are an even better source of information, since they are typically not as biased.

    Analyst reports can be found in places including:

    • Stock Brokers - Many stock brokers offer access to certain analyst reports for their clients, including many discount brokerages in recent years.
    • Companies - Some companies offer analyst research to potential investors, either through their website or by e-mail or phone request.
    • Websites/Services - Some news agencies write about analyst research, while services like TheFlyOnTheWall provide research synopsis to their subscribers.

    The Bottom Line

    International investors are inundated with information these days, but knowing where to look can make the research process a lot easier. SEC filings, analyst coverage, and corporate websites provide a healthy level of information that investors can use to make more informed decisions.