What we cover, and what we leave out
About 2,200 operating companies, large, mid-sized and small: every company that files quarterly and annual reports (10-Q and 10-K) with the SEC, has at least $50 million in revenue over the last twelve months, has reported a quarter in the last six months, and has at least two years of quarterly history.
We leave some out on purpose, because a reading on them would look precise and mislead you:
- Banks and lenders. They earn from the gap between what they lend at and what they borrow at, so sales and cost margins don't describe their cycle.
- Insurers. Their results turn on claim reserves and investment income.
- REITs. They're judged on rent and funds from operations.
- Exchanges, brokers and commodity pools. They move with trading volumes or a commodity price.
- Foreign companies that report once a year on Form 20-F or 40-F, such as Toyota, TSMC and ASML. There are no quarterly reports to read. Companies based abroad that file quarterly 10-Qs, such as Accenture and Medtronic, are covered.
- Very small, inactive or new companies: under $50 million in revenue over the last year, no quarter reported in the last six months, or less than two years of quarterly history.
Energy, utilities and transportation companies, drug makers and biotech, and real estate, construction and hotel companies are covered, but their Price alignment carries a caution (⚠): their share prices often follow commodity prices, trial results or other forces outside the business.