1) No one can determine a publicly-traded company’s Long-Term Financial Strategy just by analysing and researching the historical 10-K reports.
This is a common misbelief. There are several different kinds of specialized reasons for analysing financial statements including: determining the value of a company, projecting what their earnings will be, determining if the company would make a good merger or acquisition candidate. Banks also analyse financial statements for different types of lending including cash-flow lending, asset-based lending, agricultural lending, and many other types of specialized lending. These are just a few of the different purposes or subsets of analysing financial statements. For each of these subsets, models or methods have been designed to focus on fulfilling and reaching the specific intended purpose.
Up until now, as far as we know, no one has developed a model designed to focus solely on determining the Long-Term Financial Strategy of a publicly-traded company. Now we have.
This is a special-purpose use of the financial statements, just like the other Special Purpose uses of analysing financial statements. Determining the Long-Term Financial Strategy of a publicly traded company certainly can be done as we will show you but it is not easy because although companies are required to disclose all relevant and material monetary and non-monetary financial information, they are not required to be open when communicating with stakeholders regarding matters related to their business strategies including their Long-Term Financial Strategy.
2) Other analysts are already analysing the Long-Term Financial Strategies of publicly traded companies.
This is another common misbelief because some people do not understand the concept of being a specialist and assume that some financial professionals know everything because they know one thing well.
Our model does not attempt to value a company, nor does it tell you directly if a company has the capacity to repay a loan, but it does focus directly on determining what the company’s Long-Term Financial Strategy is. Just as other financial models focus on determining their intended purpose rather than focusing on determining any given Company’s Long-Term Financial Strategy.
Our model has been specifically developed and designed to determine the Long-Term Financial Strategy of any give publicly traded company, where other models are not specifically designed for this purpose.
3) Who cares what the Long-Term Financial Strategy of a publicly traded company is?
Business Stakeholders include: investors, lenders, business partners, employees, customers, and vendors. All stakeholders should care what the Long-Term Financial Strategy is for any given company they are doing business with because the Long-Term Financial Strategy determines the viability and long-term success of any given company.
4) Why is this information important?
This information is extremely important in determining the long-term viability of any given company that you are doing business with or intend to do business with. The information is also extremely valuable and can be used lucratively if the Company’s stock is going up because understanding the Long-Term Financial Strategy will unearth the answer to the question of whether or not the Company has a sustainable competitive advantage no matter what the financial news is reporting.