We are increasing our coverage universe by adding Primary Coverage companies. Companies designated as Primary Coverage have models that do not include the proprietary data from the management discussion & analysis (MD&A) and footnotes that is included in the models for the stocks in our Premium Coverage universe. Primary Coverage models, at a minimum, include financial statement data from the income statement, balance sheet and cash flow statement.
Our Primary Coverage will continue to deliver superior data, models and investment ratings compared to legacy data and research firms, because legacy firms fail to capture ~30% of the unusual items reported on the income statement as shown in this paper published in The Journal of Financial Economics.
Primary Coverage tickers will be marked with a “Primary Coverage” Analyst Note so clients can easily determine whether the rating for a particular company is based on Primary Coverage or our Premium Coverage, the latter of which incorporates data from the MD&A and footnotes that has been proven to create idiosyncratic alpha.
We expect these changes to be live on our site on July 28, 2023. For data feed clients, Primary Coverage companies will be excluded from data feeds.
This article was originally published on July 21, 2023.
Disclosure: David Trainer, Kyle Guske II, Hakan Salt, and Italo Mendonça receive no compensation to write about any specific stock, sector, style, or theme.
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