Get alpha from 10-K filing season
The Journal of Financial Economics (see here) proves how New Constructs’ Robo-Analyst technology overcomes material shortcomings in legacy data firms to provide superior fundamental data, earnings models, and research. During the Real Earnings Season (Feb 14-Mar 18), the Robo-Analyst found 38,314 Core Earnings, balance sheet, and valuation adjustments with a combined value of $18.9trn.
American Airlines (AAL) - Losses still bigger than many realise. Earnings Distortions totalled $3.5bn (173% of GAAP earnings).
GlaxoSmithKline (GSK) - Growing Profits + Cheap Valuation = Very Attractive Rating. Core Earnings of $6.9bn > GAAP earnings of $4.4bn.
International Flavors & Fragrances - Why understated profits aren’t always a good investment.
In addition, material weaknesses in internal controls were identified at several stocks including CBRE Group, Coupang and SeaWorld.
Edition: 132
- 01 April, 2022
Pharma ESG: A sector specialist’s view
Intron Health Research’s latest report shows clear evidence that typical Pharma ESG ratings bear little resemblance to mid-term share price performance. They have therefore designed an ESG framework unique to the industry; governance is at the forefront of the model whilst social factors have a lower weighting. They show that AstraZeneca and Novo Nordisk fare the best, and GlaxoSmithKline and Roche fare worst.
Edition: 119
- 17 September, 2021
Overwhelming Valuation Case for Large Cap Pharma
Healthcare
Pharmaceutical stocks are significantly cheaper than Consumer Staples (which look expensive and vulnerable) and should form part of the defensive ends of portfolios - half of Willis Welby’s Pharma coverage comes in with implied to Y3 EBITM ratios that are less than 100 and these ratios exclude the imponderable benefit of new science and consequently numbers are MUCH MORE conservative. Top picks: GlaxoSmithKline, Sanofi, Roche and Novartis.
Edition: 117
- 20 August, 2021
GlaxoSmithKline (GSK LN) UK
Healthcare
Disputing Elliott Advisors’ 45% upside - Intron's SOTP analysis explains why this is unlikely to occur within the timeframes proposed. GSK Pharma (ex-ViiV) would have to trade on 59x 2022 PE and CHC on 30x 2022 PE whilst ViiV would have to trade on 12x 2022 EPS despite the DTG patent expiry in ~6 years. However, Intron does support Elliott’s view that the board needs more industry knowledge; plus the incentivisation scheme needs a major overhaul in-line with the most innovative companies in the sector such as Novartis and AstraZeneca.
Edition: 114
- 09 July, 2021
Roche (ROG SW) Switzerland
Healthcare
Intron downgrades the stock to Sell - based on ROG's increasingly gloomy biosimilar outlook, high likelihood of EBIT downgrades next year, collapse of its pipeline and absence of any emerging blockbusters. TP CHF280 - implies ROG trades on 14.3x in 2022 - a 7% discount to the sector. This is more than justified given its 0% EPS growth this year and just 2% next year. It is the slowest growing Pharma name (ex-GlaxoSmithKline) on a 5-year view.
Edition: 109
- 30 April, 2021