Volume 24, No. 3: Get Ready To Dig Into the 2014 10-Ks


Here on the East Coast, everyone knows about “digging out” – as in, finding a way to get from Point A to Point B by moving a ton or so of snow. It’s already started snowing 10-Ks, however, and by the first of March, all of the biggest flakes will have fallen. That’s the filing deadline for large accelerated filers with December 31 year ends. In a matter of days, investors will find themselves buried under an avalanche of 10-K filings. The smaller fry have as long as the end of March to complete their public filing duties.
10-K information is too good to ignore, and investors shouldn’t pass on it. Information overload can strike anyone at any time, and excuses can always be made for ignoring the “drudgery” of reading 10-Ks. It’s only drudgery if you believe in the efficient market theory and think someone else has done the heavy lifting and all the good news or bad news is incorporated into the stock price. It’s not drudgery if you’re trying to outsmart the competition, and if you’re an active manager, that’s your whole reason for being.
Come to think of it, reviewing 10-Ks isn’t drudgery – it’s a privilege. There are many ways the U.S. financial statement package could be improved, but the annual information package is a feast for investors who truly want to learn something about a company. In this report, we’ll review the analyses you should make with some information that’s available only once a year.

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