Unveiling a Trust-Based Rating System for Smarter Investing - January 2025 Training

Thanks to everybody for joining us today. We're really excited to have you all here. We got a lot of new faces. We're excited to share our latest training with you, The Truth About Wall Street: Unveiling a Trust-Based Rating System for Smarter Investing. I'm going to show you how to use Our unbiased research to outsmart Wall Street media hype to build a solid portfolio. Our typical disclosures and disclaimers: we are not advisors. We do not give advice. We do not make recommendations. We are a publishing firm. We provide insight and research just like any other periodical like the Wall Street Journal or similar. Now. I want to hear from you guys, especially the new folks. Love seeing a lot of the folks that we've seen here before. We've got a lot of new folks, got a lot of new folks in the New Constructs network welcoming in from other channels and partnerships. So please get into the chat. I want to know what city you're from. We typically have people from all over the world in these trainings. Let us know what kind of investor you are. Are you retail? Are you a hedge fund manager? You an advisor? And then lastly, and most importantly, Get your picks in. If you want us to cover one of the stocks on your list, then you need to get that pick in here so that we can start taking votes on which investors are, uh, or which tickers are getting the most votes to be analyzed, because we're going to go based on popular demand. Here's our agenda today. I'm going to talk to you guys about how media and Wall Street manipulate numbers to trick you into buying the wrong stocks. I'm going to show how to use New Constructs unbiased research to outsmart Wall Street and the media hype to buy the right stocks. I'm going to give you the best methods to perform genuine due diligence on potential investments. I'm going to give you— show you how to get access to our top stock picks in the top 3 sectors. And free bonus, as I just mentioned, bring us your tickers. I'm going to analyze 3 stocks based on popular demand, so get those requests into the chat if you want one of your stocks to be covered. I'm very proud to meet everybody. David Trainer here, CEO of New Constructs, founder of New Constructs over 25 years ago, and, and been— and for more than 25 years I've been working in machine learning, robo-analytics, finance, accounting, you name it. I love this stuff. I live and die by it. And I think we've built the best system in the world for fundamental research. That was my goal, and I'm excited to be bringing this to more people. Now, New Constructs— we've recently seen an influx of new people who've joined our community, and for that reason, we wanted to give you a warm welcome and more importantly dive into the fundamentals behind what makes a great stock pick. Because at the end of the day, that's why New Constructs exists. We're here to provide institutional-level research to everyone so you can pick the best stocks and build real Wealth. Again, that's why we're here for. New Concepts exists to give people access to the truth to make smarter investment decisions. We provide trustworthy investment strategies despite the market hype and misinformation. And as we enter into a new year, it's prime time for investors to reassess portfolios and establish a strong foundation for the year. In order to do this, Investors need to have accurate and reliable tools at their disposal, ensuring they capitalize on opportunities and avoid costly mistakes. I'm thrilled to say that we have the best database in the world to analyze the entire market and outperform as investors, no matter the external circumstances in the markets or economy. And today I'm going to show you how you can access our proven superior research and get access to our top stock picks in the highest-ranked sectors for the coming year. And if you're one of our new members and wondering why you should use our research and stock recommendations, you should know that our stock picking has beaten 16,000 buy-side professionals to claim number one rankings from SumZero, a buy-side-only competition or buy-side-only platform. So let me put this to you in another way. We've been consistently ranked for 43 straight months number 1 in multiple stock picking categories on SumZero, which is a competitive platform for buy-side professionals, not sell-side professionals, not folks on Seeking Alpha that can pick whatever small-cap stock they want to pick, but for buy-side professional investors. We rank number 1 consistently every month for 43 straight months across multiple categories. In addition to that, our research has been studied and vetted by some of the most prestigious institutions in the world, including the MIT Sloan School of Management, Harvard Business School, Ernst Young, the Journal of Financial Economics. Doesn't really get any better than that. We've also been amongst the first to recommend many of today's most valuable stocks, including Microsoft at $42, Apple at $195 a share, Eli Lilly at $36 a share, and even Nvidia at 57 cents a share, right? Incredible picks that we've made over the years. But not just the big fancy picks or the big well-known stocks. We've also been able to recommend many lesser-known hidden gem winners such as Williams-Sonoma, 494% gain over 8 years versus the S&P at 162%. Jabil, 266% gain over 4 years versus the S&P at 55%. Sprouts Farmers Market, 428% gain over 4 years versus the S&P at 59%. Now, before we get into the training, I have to be transparent with you. If you're looking for the next meme stock that returns 1,000% for no apparent reason, the next overinflated stock you can cash out on next week based on hype in the mainstream media, or how to find the next crypto coin that's about to explode, I'm not your guy. On the other hand, if you want to be an investor, not just a speculator, if you want to build wealth to retire comfortably, If you want the best research before making investment decisions, or if you're looking for steady income and growth from stocks that have great fundamentals, you have come to the right place. At New Constructs, we've been analyzing stocks for over 2 decades. We've seen nearly every market type, from overvalued markets, uncertain markets, election year markets, recessions, wars, technological booms, market crashes, pandemic markets. And if there's one lesson I've learned throughout, it's that no matter the market, there are still plenty of stock opportunities with massive upside potential. And these gains can happen in the next 3 to 6 months, such as CIGA Technologies. When we upgraded it from unattractive to very attractive, Stock was up 37% the next month. Cite Sciences upgraded from unattractive to very attractive, and the stock was up 32% in the next month. How about Cohen Company? We upgraded that from neutral to very attractive, and it was up 32% in the next month. Finding outperforming picks in a difficult market is not easy. The number of attractive— the number of stocks that get an attractive or better rating in our system is very, very small. But finding outperformers is 100% possible if you have the right research, because the truth is you're being misguided by Wall Street and the media. How do I know this? Well, I saw it firsthand when I was working on Wall Street in the late 1990s. I worked at Credit Suisse First Boston, a bulge bracket investment firm and the number one tech investment banking firm during the tech bubble. And during that time, I was meeting with the co-heads of Credit Suisse's technology equity research group. And one of the most unsettling practices I noticed was that it was the 2 sets of earnings estimates that the directors of technology research told me they used. 2 sets of earnings estimates. These 2 sets of estimates were used for very different reasons. One of them, and for different clients, one of them were the set with the estimates they gave to institutional clients and what they used internally for their modeling. The other set was what was displayed to the public for the purposes of determining consensus earnings. Now, the reason I had this meeting is that I was trying to get these folks to use my Value Dynamics Framework model. And at the time, Nearly all the other analysts, non-technology analysts at Credit Suisse were using that model. Everyone across the firm. But the people in the technology department or the technology group at Credit Suisse were a lot more resistant. So I'd had a few meetings and eventually I made it to the very top and I'm talking to the top guys. And in the beginning of the meeting, they gave me all the normal excuses as to why they couldn't use my model, which I refuted politely as I had 100 times before that. And so when I pressed them after that, they finally gave up the real reason they could not use my model. You see, the codes of research told me, David, if we use your model, then people will realize our estimates are way too low and the stock will look too expensive. And I said, well, then why would you have a buy rating on companies that you think will have such low earnings? And they— their answer was, Oh, come on. You know how it works. Stocks go up when they beat the number. So for the stocks we like, we publish extra low estimates so they can more easily beat the number. And I was sort of blown away and I said, okay, wait, wait a second. Let me understand this. Then do you publish extra high estimates for stocks for which you do not have a buy rating? So it's harder for them to beat the number? Yes, we do. And then I asked, how do you come up with target prices for your buy-rated stocks with such low earnings estimates? This is where I got the double number. Oh, we have a different set of estimates that we use for target prices in talking with our institutional clients. And I responded with, so you want to keep the higher estimates that you use to value the stock a secret while using the lower estimates to help the stock go up by keeping the consensus estimates lower, correct? Yes. Correct. That's when I saw firsthand Wall Street's earnings manipulation. They had 2 sets of numbers they used for stock ratings. The ones they gave to institutional clients and used internally, and the ones they displayed to the public. This is a common practice, remains a common practice, I'm sure. And the reason was simply because that's how Wall Street works. And let me explain to you, when I say that's how Wall Street works, what we were talking about is that Wall Street's out there to make money for themselves. And their fellow Wall Street insiders, and they often use the public as shills to make that money. Happened a lot in the tech bubble. There are a lot of great stories— terrible stories, I should say— from the tech bubble. The one I gave you, though, is one of my favorite because of just how blatantly inappropriate and misleading that they, that they acted, and they took it for granted. And New Constructs, it was my experience with that kind of stuff on Wall Street that made me want to do something different at New Constructs. And we do a lot of things different. Our ratings are often also very different from the mainstream. After seeing the inner workings behind how Wall Street actually makes their money and manipulates their earnings and stock ratings, I've been committed to give you the truth when it comes to stock ratings and research. Because it all comes down to our mission. new constructs to improve the integrity of the capital markets. And that means providing the best fundamental analysis of stocks in the world and to make it affordable for all investors. So it's not just Wall Street insiders who know what to do. I think this is important for our country. I think it's important for our society. I think allocation of capital is one of the most important things that we do as humans. And as long as the United States can continue to allocate capital More effectively, right, to its highest and best use, will continue to be one of the greatest countries in the world. And allocate— misallocating capital, misallocating capital is one of the worst things we can do for our country. Now let's get into some examples, specific stock examples, to show you what I mean. According to Wall Street, EPAM Systems was a buy or hold rating this year. According to New Constructs, EPAM was unattractive or neutral. The result? EPAM is now down 27% over the last year. Another example, for Wall Street, MongoDB was a buy rating most of the time for the past year. At New Constructs, it's been unattractive throughout the past year. The result? MongoDB is down 39% over the past year. Keep in mind, the S&P's had a pretty good run over the past year. So this is a net underperformance of a significant amount. According to Wall Street, Teladoc Health was a buy or hold most of the past year. According to New Constructs, unattractive throughout the past year. The result: TDOC is now down 54% over the past year. My story at Credit Suisse is an example of me seeing firsthand how corrupt Wall Street ratings are. And I would tell you that trusting Wall Street is like trusting tobacco companies saying that cigarettes are not harmful or addictive. Sure, they did it. They did it right up into the very end. Should you have trusted them? Should you believe them? Heck no. What they say they do and how they do it and what they say about their product is about how they make money, not necessarily how you make money. And that's why I compare Wall Street to tobacco companies, because they're putting out a message that helps them make money, not necessarily one to make you make money. But you don't necessarily need to be an insider to know how biased Wall Street is, as their deceitful actions have been documented and proven over and over again throughout the, throughout the years. You don't just need my firsthand experience. Let's get into some quick case studies to show you what I mean. What I mean, here's a great case study from Harvard Business Review titled The Bias of Wall Street Analysts. According to the study by Harvard Business School, Wall Street analysts' recommendations are often influenced by business relationships with the companies they cover. This bias can lead to overly optimistic ratings. Newsflash, how does Wall Street make money? Anybody have an answer? Throw it in the chat. How does Wall Street make money? Do they make money selling research? How much money do they make selling research? What percentage of their revenue comes from research? Anybody know? Less than 1%. What percentage of their revenue comes from investment banking deals? We get some veterans who know the answers. Yes, it's almost entirely from investment banking and some from trading, sometimes a large amount from trading. Point is, the research folks don't make any money. Who do you think makes decisions at the firm? Investment bankers. And if the research people aren't doing things that make the investment bankers happy, guess what happens to them? Offer their heads. I saw it firsthand. Some of the top analysts, my good friends on Wall Street, they got fired because they disagreed with the bankers about how many buy ratings they should have. Here's another study from US News and World Report. Stock analysts are more biased than you think. According to this report, 49% of ratings on stocks in the S&P 500 are buy or outperform, while only 6% are sell or underperform, indicating a significant bias towards positive ratings. Okay, it makes sense now, right? Investment bankers want to get business from companies. Do you think companies are willing to give the bank business if their analyst is telling everybody to sell the stock? It's a terrible company. Probably not. They're more likely to give business— companies are more likely to give investment bankers business if the research analysts are saying good things. Understand the conflict here? Wall Street analysts, research analysts have a hard time staying employed if they are not positive. Here's another great study: 96% of stocks covered by Wall Street are listed as buy or hold. Those are the stats right there. Check out the link below if you want to look up this research, this article yourself. 96% are buy or hold. You think 96% of all the stocks in the market? Are that good? I don't think so. Directly from the study, the proportion of sell-side analysts maintaining buy-and-hold ratings on industry stocks in December 2024 was about 96%, up from 92% in November. Interesting. Wall Street gets more bullish when the stock goes up, stock market goes up. They're feeding into that on purpose. Conversely, the percentage of stocks which analysts recommended selling was was around only 4% in December and 8% in November. Getting more bullish and more go-go-go-ish is what Wall Street does during tech bubbles or during market bubbles. As I mentioned before, that's because their paychecks depend on you buying stocks. It's how they make their money. While Wall Street wants you to buy or hold 96% of stocks, I want you to know that less than 13% of our stocks have an attractive rating or better, and less than 4% are listed as very attractive. We have fewer very attractive rated stocks than they have sell-rated stocks. Now, we already mentioned Wall Street analysts want you to either buy or hold over 96% of their stock recommendations. And according to recent data, 53-57% of Wall Street ratings For stocks are listed as buy compared to just our 13%. Look at that chart. Wall Street buy ratings versus new constructs buy ratings. Big difference. Here's a quick sample of how our stock ratings compare to Morningstar ratings. So Wall Street's a big, big place. It's not just investment banks that got ratings you need to be careful of. Look at Morningstar. You can see all these stocks. All had the top ratings. This is their version of very attractive. We only overlapped with 2 of them with very attractive. Otherwise, it was attractive, neutral, and unattractive. Significant differences across the board. Here are more examples of misleading Wall Street buy ratings and how they compare to our honest, trustworthy ratings. New Fortress Energy was a buy or hold over the past year. Unattractive new constructs, down 59%. Buy or hold over most of the past year, new constructs unattractive, down 85% over the past year. Moderna, buy or hold over the past year, unattractive to very unattractive throughout the past year. New constructs, what's the result? Down 67% over the past year. So why is our research different? Diligence. We've done the work. We go through the numbers. We analyze thousands of pages of SEC filings practically every week, millions and millions of pages over the years. And we uncover Critical data that is often legally buried in the footnotes. This is why it happens so often. It's actually legal. You may also be wondering, sure, your stock ratings at New Constructs are different from Wall Street, but how do we know they are better? Well, how about 43 straight months of number one ranking by some zero? How about these 3 papers? This paper down at the bottom, specifically about our stock ratings. Shows that they're superior to Wall Street ratings. The top paper here is a paper that was also published in a top-tier peer-reviewed journal. That paper actually— it's a 70-page paper that goes into tremendous detail around how our data, the data that we use, is more comprehensive, more accurate, and creates abnormal returns or idiosyncratic alpha. Or novel alpha is the way the authors put it. And then in the middle here, superior analytics from Ernst Young. Look, when you got better data, everyone who's ever built a model knows that the models are only as good as the inputs. So when the inputs are better, you've got better data. You got better output as well. Our goal isn't to chase after investment banking deals. Nor are we driven to inflate any company's earnings. In fact, there's a perfect movie clip that demonstrates exactly how corrupt mainstream research is. Watch this clip from The Big Short. Kyle, will you put that clip— put a clip to that into the, into the chat for us? The big pick— the big punchline occurs at 57 seconds in inside the clip. on YouTube, which is if we don't give them the positive ratings, they'll just go right down the street to our competitors. So that's the deal. And that was the same thing is true with the Credit Suisse during the tech bubble. The point was, if they don't fall in and act corrupt and just give out good ratings, they miss out on making a ton of money. And the guy down the street is just going to make the money instead of them. So they're like, wait a second, right? And that's really what's happening at Credit Suisse. Like, that tech team was sort of a second or third iteration of other tech teams that had seen how basically corrupt the business was, and they were all in on just like punching out IPOs. That's why Credit Suisse was the number one tech investment banking firm during that timeframe, during the tech bubble. And by the way, they got fined. It was the largest fine in, in the history of Wall Street. Led by Eliot Spitzer, who's become famous for other reasons, but it was the biggest settlement of all time, and it was a drop in the bucket for how much money they made overall. Trusting Wall Street research is like trusting tobacco companies saying cigarettes are not harmful. I wanted to put this in there, put this in there again, because I think it's important for you guys to understand that. And it's important for you to understand that backdrop because we are a trust-based research firm, and we wouldn't have to do that if the majority of the research out there wasn't already good. Our commitment is to deliver the unfurnished truth, to earn your trust through clear and honest research and ratings. Transparent, clear truth. We've mentioned we've meticulously analyzed every detail right down to the crucial data hidden in the footnotes. By the way, footnotes data is the data that no one else has. That's proven in one of the Harvard papers. And transparency is our ethos. We provide comprehensive insights into how we calculate every metric in our models, every data point that goes into every metric. How else do you think companies and firms with reputations like Harvard Business School, Ernst Young, MIT Sloan— how else do you think they write papers if they can't prove What they're saying is true. So you can trust us to reveal the full story of a stock 100% of the time. If these firms can trust us, so can you. And when you look at the true economic earnings and valuation of a business, you get the facts behind stocks. This will help you make far better investment decisions. For you, for your money, or your client's money, and can help you uncover hidden opportunities in the stock market, such as LifeVantage upgraded from neutral to attractive and up 20% in the next month. Crocs upgraded from neutral to very attractive, up 11% in the next month. Bath and Body Works upgraded and up 10%. In the next month. Dorian listed as very attractive in May 2024, up 18% over the next month. Now, downgrades in our ratings to unattractive and very unattractive warn investors for stocks that are about to fall. So it's not just about finding the good stocks, we're also good at finding the bad stocks. And let's face it, you got a market out there of like, you know, close to 33,000 actively traded stocks. There's a lot of bad ones out there, a lot more than just the 6% that Wall Street talks about. We downgraded it from attractive to unattractive, and it was down 28% over the next month. Big 5 Sporting Goods, downgraded from neutral to unattractive, it was down 27% in the next month. Zymeworks, downgraded from neutral to very unattractive, And it was declined, and it was down by 16% in the next month. We believe if you want to survive and thrive in 2025's market, you need trust. And we are the only research firm that does that, does the work in the footnotes and the fundamentals to give you that independent, non-conflicted, trustworthy research. I see some questions in the chat about other research firms, and one of the defining Criteria differences between us and VectorVest or anybody else is that extra data in the footnotes. Extra data in the footnotes. No one else has that. Our fundamental analysis is significantly, meaningfully, and incrementally better. And let's face it, like, why would you trust anyone who's conflicted like Wall Street and the media? Right? They want the markets to go up. They're trying to get banking deals. They're trying to sell ads. They need happy markets. Why would you trust people that are conflicted? Trusting Wall Street and the media is like trusting tobacco companies who said cigarettes are not harmful, addictive. I'm saying it again because it's that big a deal. Our independent research also has a technological advantage. It's called robo-analyst technology. How do we do it? We use the first and best AI for investing. That's how we can do this for so many stocks. 10,000 stocks, ETFs, and mutual funds in our database. Our roboanalyst technology is used to get the data, to build the models, and reveal the truth. I did this work manually for dozens of years, and, and I still do it manually some. Let me tell you, technology is way, way Way better. Here's our Robo Analyst rating visualized. You can see how it works as a five-point system from very attractive to very for very attractive, very unattractive. We have five component ratings. This AI has the ability to comb through thousands of government filings with precision, analyzing every line and footnote. Some executives from the top firms in the world. I've been using this system for decades. There are 5 core metrics that our rating system is based on. 2 categories for these metrics: quality of earnings and value. Economic earnings versus reported earnings. That's looking at the true economic earnings, also known as EBA, also known as CROCE, also known as economic margin. It's that comprehensive measure that you hear a lot of people talk about. We do it better than anyone else in the world. Why? Because we have better data. Economic earnings is not a difficult formula. It's all about getting the right data. And we look at the comparison of that with accounting earnings, GAAP earnings, reported earnings per share. Reported earnings, GAAP earnings, same thing. We like to see how economic earnings and GAAP earnings are moving versus each other and what their relative level is. So very important in terms of understanding quality of earnings. If GAAP earnings are high and rising and economic earnings are negative and declining, That's a misleading trend. That's bad. We don't like that. We also look at return on invested capital. I want to understand every company in the world, how much cash flow that company generates relative to how much capital has gone into it over its life. I mean, who wouldn't want to know that? You want to know how much capital you've given a company, and you want to know what kind of cap— what kind of return they're earning on it. This is the most important metric. This is a metric that Warren Buffett talks about all the time. We measure this better than anybody else. That's what Ernst Young wrote a paper on, getting ROIC right. I don't think there's another research firm in the world that has had— I've been asking this for years. Put it in the chat if you know any other papers, any other papers that have been written on another research firm, another research firm that has papers proving their research is superior. They don't exist. All right, let's go to talk about some valuation metrics. 2-year average free cash flow yield excluding cash— that's a fancy and complex way of just talking about free cash flow yield, right? When it comes to valuation, I want to know how much value of the business is being given to its free cash flow. Price-to-economic book value— one of my favorite metrics of all time because it's such an intuitive metric, especially when you're looking at cheap stocks. But it looks at the price of the stock relative to the, to the no-growth value of the business based on cash flows. So as opposed to just looking at price of this one point in time earnings, we're looking at the cleaner after-tax profit, the perpetuity value of that. So we can look at price relative to the perpetuity value of the existing cash flows. So when the price is higher than that, well, the price has growth embedded into it. If the price is lower than the no-growth value, Then the price has profit decline embedded in it. Lastly, the market implied growth appreciation period. This is probably the, the most sophisticated metric in any rating system of any research firm in the world. The market implied growth appreciation period is based on our reverse discounted cash flow model. So what we're looking into, what we're looking at here is the number of years of profit growth baked into the stock price. And we do this using, again, a reverse discounted cash flow model that's explained on our website. It's just part of a methodology called expectations investing, which seeks to quantify the number of years of profit growth baked into a stock price. And it's the one true best way to really understand valuation. And that's a core component in our rating system. But that's all 5 of the components. Fees— this is what goes into every one of our ratings. And the system, the rating system, is designed to make it simple for you. If I were here, and I know I talked about a lot of complex stuff here, but if we're going to give you just a bunch of complex stuff, that doesn't do any good. I think real value, real honest value, is going to give you something that you can take away and use. Green means good. Red means bad. When you see green for a rating, that's good. Red means bad. It's that simple. We are synthesizing thousands and thousands and thousands of calculations and pages and data points to give you a green means good and red means bad. All 5 metrics play a critical role in rating a stock. So does hundreds of thousands, millions of pages of filings and data and analytics. But we boil it down to something that simple. Did you know that we're the only stock rating system, only research firm that I know of with an official U.S. patent? And then you want to know, you want to know more about how our AI works. I put this in the slides as well. This is an interview I did at the Stansberry Research Conference, a fantastic conference, by the way. I've been to a lot of Wall Street conferences. This conference was my favorite by far. But I talk about AI because they're asking me about that. Like, you know, they want to know, like, a lot of people talk about AI. How does this actually work for investing? Well, first of all, anyone who's trying to make you think their AI is magic, It's not. You already heard me talk about how much work goes into our ratings. Our AI helps us do that with greater speed. But at the end of the day, data is what matters more than technology. And our AI is based on the best inputs in the world. And you can trust us when we say that because we'll give you the data to audit it. If someone's not willing to give you the data behind their AI and show you how it works, Please turn and run. If they're wanting— if they're looking— if they're hiding stuff, that's a bad pro— that's a big problem. The other thing to keep in mind is that AI can't work for the world. AI can only work in specific areas where it's got really good clean datasets. That's why ChatGPT is not reliable. Heard all this great stuff about ChatGPT. Oh, we don't hear about it anymore. Why? Because it hallucinates all the time. Why? Because it's based on the internet. How much of the internet is reliable? How much of the internet is trustworthy? How much of the internet is downright evil? Right? I mean, there's a lot of bad stuff. It's not what you want in an AI system. It's not what you want to be relying upon. It's not what you want to be trusting. And I've said this kind of a second ago, but real AI, reliable AI must be focused on a— based on a focused dataset, curated and put together specifically for that purpose. Our robo-analyst technology leverages AI to do research that most people don't do, to do the proper due diligence on your behalf. That's what I created New Constructs to do, to build a technology that would allow us to go through filings with greater speed and precision than human analysts ever could. Because it comes back to something Tom Brady said, to win in this world, you have to be willing to do things other people will not do. You know, to heck with all this, like, people trying to make everything seem easy. Oh, the easy button, get rich quick, everybody's having a great time, everyone gets a trophy. No, doesn't work like that. Doesn't work like that in the stock market either. Either it doesn't certainly work like that in business. You need to be able to do— be willing to do things other people will not do. And that's what we did with our RoboAnalyst technology. We created a technology that does things That has never been done before. That's why it delivers alpha from the footnotes. And it delivers alpha, novel alpha, because the market is missing footnotes data. That's exactly what Harvard Business School proves in their paper. Most investors and professionals don't have the time to find and read footnotes. Why? Because they're buried in filings that tend to be 200 to 2,000 pages long. Think about that. That's 4 times a quarter, 4 times a year. Every quarter you're looking at at least a 200-page document for every single company that you cover. But that's what's required to do proper diligence. This process costs millions of dollars per quarter for firms to get proper calculations, which is why almost nobody does it. They don't have the manpower. They don't have the resources. It's just easier for firms to blast out, buy, buy, buy, buy now. Now, earlier we hinted at how you can access our proven superior research at the lowest possible price. And with your permission, I'd like to get into how you can do exactly that today. The best part? You don't need a PhD in finance or supercomputer to make this work because our AI will do all the heavy lifting for you. Now, free bonus, live demonstration time. I'm going to take one of your tickers and share with you our proven superior research. First, I'm going to run it through the Stock Tracker 50 so you see what that looks like, and then I'm going to run it through our Pro membership so you can see how much data and, and information is behind what you get for Stock Tracker 50. All right, SoFi. So this is with our Stock Tracker 50 membership. Again, you see red is bad. There's no green here, but you get to see the rating and you get to understand where it ranks in each one of these categories. So you understand exactly what's going on. We'll tell you the closing price that this rating is based on, because by the way, these ratings are updated daily. You're also going to get alerts. Every time one of these changes, if it's in your portfolio, you can track 50 stocks with Stock Tracker 50. You get to know the sector. We also let you know the latest filing, right? Because our data is based on the real filings. And then we'll tell you when the next expected filing is coming in as well. So that's SoFi based on our rating system. What do you get if we are looking at a pro membership? So with Pro, you're going to get quite a bit more. And I want to demonstrate this so you can see all that goes into a rating. You're getting the same red is bad, green is good details. You don't get the underlying data behind it. You don't get to see how it stacks up against the indices. There's also a rating breakdown. So you can see these economic earnings trends over time. You can see economic earnings are negative. Thus, you know, and the same is true for accounting earnings. So thus it's neutral. You'll see here return on invested capital super low, which is why it gets such a low rating. Here you can see free cash flow. Well, we'll also show you the return on capital DuPont model. So you can see margins, capital turns, free cash flow. You see that, that free cash flow number, the 2-year average free cash flow trend. See the price to economic book value, how the economic book value is well below the stock price. And then here's a summary of the market implied growth appreciation period. Additional transparency tools that we provide are these marked-up filings. You want to understand where all the data comes from? Income statement adjustments. What do we see? This allowance for credit losses, restructuring charge based on page 68, buried in some note here, probably around how they adjust EBITDA, their adjusted EBITDA number. Gain on extinguishment of debt. That's another unusual gain jacking earnings up more than they should be. We do this for all the filings we have, I think, over the history of the company since its IPO. So this is probably the S-1, but you get the idea. Acquisition-related costs on page 161. Anyway, you get the idea. There's enormous amount of data. All that goes into what you're seeing in your Stock Tracker 50 rating. enormous amount of work to give you, to synthesize for you what we believe to be the best rating system in the business. All right, let's get back to this. Now, we understand that many of our followers might not, might not be investment professionals or invest enough to afford our premium level membership. We also understand all the nitty-gritty, nitty-gritty details that go into our proven superior analytics might not be of interest to everyone. However, everyone still wants to make decisions based on the best research, we hope, especially when it's proven superior by such prestigious institutions with sterling reputations as the Journal of Financial Economics, Harvard Business School, Ernst Young, MIT Sloan, you name it. For that reason, we created the Stock Tracker 50 membership. This membership gives you our overall rating and all the component ratings, just like our higher-priced memberships, but without all the background details that they provide. Here's what you get with Stock Tracker 50: ratings on 10,000+ securities updated daily. Look them up, get the answer, get the truth. Check your portfolio, check recommendations from other firms, do all of that portfolio tracking. For 50 stocks, ETFs, or mutual funds, put them in the system, get updates daily. So, you know, immediately, again, we're updating these things every day. New filings come in every day, once a quarter for every company, but sometimes more often than that because you get amended filings. Lots of— you get lots of amended filings throughout the year. So there's new data coming in. We're checking on that daily. We're updating for stock prices and updating our valuation analytics. Daily, and we will alert you for all of the tickers that you have in your portfolio. They're the portfolio email alerts that you'll get on a daily basis. And the other really big thing here is education. We show you how we make every single adjustment. We show you how we calculate every single metric. We want you to know how much work we're doing. We want you to know How the metrics work. Why? Because we believe they're the best in the business. You can trust our work because we're transparent. We got nothing to hide. We wish— we just want you to know how much work we're doing for you. In fact, we just want you to appreciate how much this hard work pays off. The comprehensive nature of our research entails countless pages of data and documentation, including information from balance sheets, income statements, cash flow statements, footnotes, dozens of other disclosures. Producing and maintaining this level of detailed research would set you back millions of dollars each quarter at a minimum, if you could even find the people willing to do it, because there's not many out there. With our Stock Tracker 50 membership, you get the superior stock ratings and updates delivered to you on a silver platter. Our models and stock ratings are built on a more comprehensive and proven superior data set, period. Other firms overlook critical, overlook critical information from the footnotes and the MD&A that we catch. They miss stuff on the income statement and balance sheet too. A lot of these firms don't even look at balance sheets. We are truly independent and don't get paid by the companies or funds we cover. You know who pays Morningstar for ratings? Mutual fund companies. That's right. They're not as— they're not as independent as you might think. Nobody pays us for ratings. Stock Tracker 50 uses AI to deliver you the re— the reality behind a company's numbers with a simple traffic light system, traffic light system that tells you what to do with each security. Green means buy, yellow means hold, red means sell. Now it's important to note this is an active service. Our ratings get updated every day, not every week, month, or quarter. That's including credit ratings. When these ratings are updated, you get alerted via email on the changes. These are ratings you can trust that are based on solid fundamentals relative to the current stock price. In other words, you won't be timing the market based off of news or hype or following the herd. No stock can outpace the facts forever. And at some point, stocks will reflect their true value. Timing the market based on news and hype is for speculators. Timing the market based on fundamentals and valuation, that's for true investors. The best thing you can do to protect your portfolio is to understand, understand the true cash flows of businesses and the expectations baked into stock prices. The best thing you can do. And the Stock Tracker 50 does exactly that. In fact, the fundamental, the fundamental research that drives Stock Tracker 50 is the best of all research firms in the world. We update our stock ratings daily based on the latest stock prices so we can alert clients as soon as we see a stock has either outpaced its fundamentals and is about to drop, or is currently cheap and is about to reach its true value. In summary, our structure— our Stock Tracker 50 membership gives you superior investment ratings on over 10,000 stocks, ETFs, and mutual funds. You get the alerts, right? And these 2 things are huge. We're simplifying the complex world of fundamental analysis with just a few clicks. It's an extreme amount of value, gives you the ability to invest smarter, to leverage the cutting-edge AI, and it gives you the educational resources. I have multiple institutional money managers who learned everything they learned— not everything, most everything they learned— and will credit New Constructs for their success on Wall Street based on our education. We believe our research can serve as your trusted resource to find the winners and avoid the landmines. We are very selective about which stocks get an attractive rating, much more selective than Wall Street. How about a few notes from, from existing clients? This is a recent testimonial, which I'm going to take the time to read to you because it's pretty, it's pretty awesome. He says, thank you for taking the time to reach out. And while I buy stocks and ETFs regularly, I'm not a trader. I look for value in my selections, and I found your analysis superior. Many stock rating analysis type services are available. But as a business owner, I know how financials can be manipulated to put forward best-case scenarios, thus hiding critical information. Your research digs that out for me and provides a high level of confidence in my selection process. I use other metrics to compare, but I rarely buy something that does not have solid ratings from New Constructs. I maintain all my investments in one of several portfolio listings on your platform, which allows me to quickly reference the asset if I see something happening. Again, thanks for reaching out, and I look forward to growing my involvement with your firm. That's the kind of stuff our clients have to say about us. Here's another money manager. I feel much more comfortable knowing that New Constructs is providing an additional layer of due diligence to my research by analyzing footnotes and making adjustments to the true economic earnings. New constructs helps me clearly see if a company is truly creating value for its shareholders. Our clients have a high level of trust in us. I think that should be very clear. Harvard Business School has a high level of trust in us. We are a truly trustworthy firm. And right now, we've noticed that trust in most U.S. institutions has withered. Trust is rare these days. Look at these charts. This is the percentage of respondents who have a great deal or fair amount of confidence. You can see from Congress, big business, newspapers, the presidency, Supreme Court, churches, organized religion, everything is tanking. And that's part of my mission at New Constructs too, is to rebuild trust, rebuild the integrity of the capital markets. Someone's got to go do this. And we believe in transparency and authenticity and only recommend stocks we believe are truly valuable Based on superior data. I hope that's been demonstrated with all of the transparency and everything we've shown you here so far and our track record. We are not compensated to promote or rate as attractive any stocks or funds. We have no conflicts with our clients. All right, time for the rest of our bonuses. What do we got? 2 more picks to go through here. Yep. Next up, we'll go with Intel, INTC. INTC, unattractive. ROIC is looking pretty bad. Free cash flow yield looking pretty bad. Yeah, we know things aren't going so well for Intel these days, and so it's a tough spot. It's not impossible to make a call that maybe they're, they're, they're cyclical bottom given the CHIPS Act and things like that, but that's an interesting perspective to take. It's not one— I'm not saying it's impossible for the stock to do well. Saying yes, if they're going to turn things around maybe the way that people think they can, then maybe this is a good time to like be contrarian. But risk-reward does not look good. Let's see what happens when we look at it in, in our system. Whoops. So we're going to find out also is with Intel, we are going to See why it's suspended. Cause: acquisition target. So it's involved with some big acquisition talks, which is going to be— which, which, if it happens, will meaningfully change the underlying fundamentals of the business. So this quality of earnings stuff could look different. Also, we updated our required cash assumption, probably increasing required cash because the profitability of the business has tanked. You can also see our credit rating here, also unattractive. Not a lot of debt in Intel because it's been great, but not looking so good at interest coverage ratio. That's not great. Or free cash flow again. Yeah, and unfortunately, to John's point, negative economic earnings, not a good thing at this point in time. All right, Kyle. What do we got next? Last one, FTNT, Fortinet. Whoops. Yeah, interesting. Good company, bad stock. Funny story, in August I was doing a huge promo with an affiliate partner and I got a question about Supermicro and it had a very similar rating. It was also suspended, but the ratings were very similar. I said, good company, bad stock. Whatever you think about how good the business is, bad stock because it's super expensive. And then when I went to the professional side later for Supermicro, because I was curious, like, wonder what the suspension was. The suspension for, for Supermicro was lack of internal controls, which we all know led to their auditor firing them. Happened very few times in the history of the world. So anyway, Fortnite does not have any of those problems. Point is, the, the rating system told clients, be careful, beware, watch out, the stock's expensive. Also showed that this rating was suspended. And when we went, dug a little bit deeper, we saw it was suspended for a reason that ended up being a really big reason. But yeah, for Fortnite here, you're seeing a super high return on capital. Yeah, I was remembering, Kyle, some of the work we've been doing. People always ask, like, return on capital. It's one of the highest returns on capital in the entire S&P 500 and has been on average for the last several years. So that's a, that's a nutty number. Like, you just rarely see anything like that, but it's all priced in. You've got a 4.6 price-to-book value ratio. That means the stock price is implying a 460% improvement in profits. So as much as you might like a stock, if it's already pricing in all the good news, it's got all the good news in there. You can't necessarily expect a lot. Alrighty. Thanks everybody. If you have any other questions, feel free to email us at support@newconstructs.com. And I thank you very much for joining us today. We will post a replay to this to our community as we do all replays. Thank you very much, and I appreciate you being with us today.