Earning Quality Analytics

Earnings Quality Website

Research Purpose: Idea Generation and Monitoring

Company Description: (EQA) delivers to investment managers comprehensive forensic accounting and corporate governance analysis of widely held public companies. Leveraging the latest academic research, as well as our proprietary quantitative models, our highly-qualified and credentialed analyst team employs a rigorous two-step research process. This process objectively identifies companies with improving or deteriorating earnings quality characteristics before they are fully manifested in stock prices.

The first step in our research process is an on-going quantitative measurement of earnings quality of 5,500 companies (5,000 largest by market cap domestic and 500 largest by market cap ADR's). Once our quantitative models identify companies with improving or deteriorating earnings quality characteristics, the second step is an analyst-driven, qualitative assessment of a firm's financial statements, filings and management statements. Our analysis manifests itself in a series of company-specific Detailed and Brief Reports, Alerts and Bulletins, as well as in our Greatest Concerns List, Watch List and Standouts List. Thematic accounting issues pertinent to multiple companies or sectors are covered in our Issue Commentary reports.

Product Features
- Searchable archive by company ticker. This is an area that could use some improvement as you are limited in your ability to search past research.
- Portfolio set-up. You can set-up portfolios that allows you to filter out the reports that you are looking for.
- Allows you to filter out ideas based on the publication date, sector, Mkt Cap. and PE Ratio.
- Daily emails with updates to new research added to the Library.

Personal Evaluation
The content of the site is very good and informative and our analysts are finding it very beneficial. It offers information in a very palletable way. Our analysts have been using it as a way to monitor stocks from a Quantitative perspective. The one draw back I found is that the user interface of the website is not very user friendly. It just seems like they felt that this was a way to present the information but I think some advanced search options might be more appropriate to sceen ideas. I can see how this tool is useful as a way of checking ideas opposed to generating ideas. I would also complain that there is no email customization. Currently you are sent a default email with the stocks that are expected to out/under perform the market based on the system. I would prefer to have only emails sent based on sector or portfolios that you can set-up in the system.

Contact
Kurt Van Houghton
Client Relationship Manager
480.237.3189
kvanhoughton@gradientanalytics.com

InsiderScore

https://www.insiderscore.com/

Product Description: (from website) The InsiderScore service provides real-time access to insider trading data and gives investors like you the tools they need to efficiently organize and decipher insider stock transaction activity. Our proprietary filtering and scoring algorithms provide you with a new edge on insider trading data, and hones in on "timely, telling, and actionable insider trading moves."

Each insider filing is "scored" using our software. Our scoring algorithm takes into account many variables, including the type of transaction, the insider's position, the size of the transaction, and the performance of the stock before the transaction, among other factors. We also score the overall insider trading "healthiness" of a company based on its insider filing history. The result: you see the most important and influential insider transactions first, both from within and outside of your coverage realm. InsiderScore is a great source for timely, telling, and actionable new ideas, as well as an instant time saver and productivity booster.

Potential Research Purpose: To track and monitor Insider Trading amongst stocks that are currently in your Portfolio and also stocks that you might be interested in purchasing.

According to Insider Score they have proven that there is a statistically significant correlation between Insider Buying and positive returns as well as Insider Selling and negative returns. This just seems like another tool that might be effective in monitoring your portfolio as InsiderScore utilizes a unique algorithm to Score every Insider Buy/Sell based on variables, including the type of transaction, the insider's position, the size of the transaction, and the performance of the stock before the transaction, among other factors. Based on the way Insiders are buying or selling it could help you determine how these Inside Investors view the potential for that particular company in the future.

Another potential use of the product would be to utilize it as a screening tool for picking stocks for your portfolio. For instance you could develop a screen for Companies involved in different Commodities and monitor when management is purchasing significant shares which would be a good indicator that management is expecting a turnaround in their industry and subsequently their companies stock price. InsiderScore provides a CSV which can easily be integrated into a tool like FactSet that you can utilize for screening potential ideas.

InsiderScore is also in the process of developing a module of there product that looks specifically at Institutional Investors that own 10% of a company which as I understand it would be unique to any other product out there.

Pricing (Estimate based on original conversation)
The pricing is based on a tiered schedule by assets that are under management. Based on his estimates it would cost my firm (16 Billion under management)......

• $12,500 for the first 3 Users and an additional $2,500 for each additional user. This would allow you access to the InsiderScore Portal along with daily emails about significant Buy/Sell activity and an email for an alert set-up by the user.
• An additional $15,000 for the Data Files to be utilized in FactSet for screening and integration purposes.

There will be an additional cost for the Institutional Investor Module when it comes out of beta.

Contact Person

Derek Syphrett -Sr. Researcher & Sales Rep.

Phone: 609-497-0076 - Email: derek@insiderscore.com - IM: 344-891-019 (ICQ Service)