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Spongebob

Hi all...I haven't been to AF for awhile, but I was hoping someone here could give me some guidance. I need research on a public company that isn't followed by many analysts. There are reports available from 4 companies, but I am not sure if all are reputable. (I work in lower middle market M&A, so I don't typically deal with public acquirors or targets.)

These are the companies that have put out reports:
Datamonitor
Globaldata
Sadif Investment Analytics
Disclosure Insight

Any impressions of which might provide the best information? Thanks in advance!

LBriscoe

I understand that, but in that case, if you were looking at thinly-traded companies or non-public ones, then a banker at Goldman Sachs would have no informational edge from an ER perspective than someone from a middle-market bank simply because there's not much research out there to begin with. If that's the case, then probably the best thing to do is to look at industry reports for the larger companies in the industry or some adjacent industry to understand the macro trends -- that's probably the most useful way to glean interesting tidbits from research reports.

Now, it's a whole other issue if the original poster just doesn't have access to good research, in which case I'd personally probably try to petition a limited-access subscription to TheMarkets or Thomson. As a banker I would feel pretty hindered putting together books or memos if I didn't have access to decent research.

AnalystAlan

middle-market bank means sometimes you deal with companies that are followed by nobody or just a few sketchballs like the ones above. perhaps its not the case she doesnt have access to better equity research, its just none out there. its not that surprising

Kapie

I have seen those reports and I don't find any of them useful for fundamental analysis. Disclosure Insight could be useful for trading but not convinced it will be that helpful for what you're trying to achieve.

If you're in banking I would think that Capital IQ would provide just as reliable comps; of course, one might argue that DataMonitor could provide some interesting ideas to look at valuation differently, but otherwise doesn't provide anything useful in terms of actionable fundamental information. GlobalData is similar as the others above have mentioned, and Sadif is just total crap.

Obviously if you're putting together a comp set you will probably need to understand the fundamental nuances of the company, as well as various adjustments you'd want to make on your own to key line items such as cash flow and EBITDA. For your purposes I would avoid any of this research. Also I'm surprised that you're at a middle-market bank and you don't have access to better equity research.

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ASSet_MANagemen

Disclosure Insight is pretty good at what they specialize in which is finding potential violations and monitoring ongoing regulatory issues. They provide scores indicating whether there is suspected activity confirmed activity and the risk level potentially associated with it and some commentary on what is going on. They can provide an early warning flag of an upcoming issue which is particularly helpful with validating a short position.

AndyNZ

steph96 Wrote:
-------------------------------------------------------
> These are the companies that have put out
> reports:
> Datamonitor
> Globaldata
> Sadif Investment Analytics
> Disclosure Insight
>
> Any impressions of which might provide the best
> information? Thanks in advance!

Datamonitor- Not too bad. Basically a 5-15 pg overview of the company. Usually updated once a year or so. Rarely contains any commentary, just a basic summary of the company, the management, and their business.

Globaldata- Similar to Datamonitor.

Sadif Investment Analytics - So dumb, I can't stand them. An entirely quant-driven research report that typically appears to have no human involvement. Tell you the companies valuation, beta, etc. compared to a (usually poorly selected) peer group and the market in general. Frequently used to line bird cages or make confetti if I print one by mistake.

Disclosure insight - I am unfamiliar with.

Hope that helps. Your best bet for really small companies (let's say less than USD1B) is usually to just go into reuters or some other newswire service, put in the companies name, and read everything there. Then read the last few annuals. Seriously, it's rare (but not impossible) that companies these small have quality research done on them.

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