Summary
- Forget all the "earnings season" analysis you read last month. The real earnings season (annual 10-K filing season) is happening right now.
- Last week, analysts parsed 421 10-K filings and collected 38,931 data points. In total, they made 7,881 accounting adjustments with a dollar value of $1.9 trillion.
- These adjustments allow us to assess a company’s true earnings and return on invested capital.
- Looking for more? I update all of my investing ideas and strategies to members of Value Investing 2.0 . Get started today »
Our latest featured stock is a consumer products company that's struggling to turn around its business. We pulled this highlight from last week's research of 421 10-K filings.
Analyst Peter Apockotos found several unusual items in the footnotes of Newell Brands' (NWL) 2018 10-K.
When NWL acquired Jarden Corporation for $15 billion in 2016, we warned investors that the deal would destroy value. It only took two years for our prediction to come true. In 2018, NWL admitted that the acquisition was failing and sold off several of its brands. The company also recorded an $8.3 billion write-down (28% of invested capital).
Now that NWL has filed its 10-K (4 days after it was due), our analysis shows that 2018 was NWL's worst year in regards to return on invested capital (ROIC) in at least 20 years.
