Altimetry's Hidden Alpha

“Alpha, often considered the active return on an investment, gauges the performance of an investment against a market index or benchmark that is considered to represent the market’s movement as a whole.” – Investopedia

Hidden Alpha is an investing research service that looks to find and recommend large-cap stocks whose profits and earnings are hidden from Wall Street and the mainstream media. By finding companies who are more profitable and better run than what 99% of investors believe, you have hidden alpha.

How do we see what others cannot?

In short, we have a small army break down companies’ “As Reported” financial statements and rebuild them in a Uniform format. We have found that there are more than 130 meaningful discrepancies in the GAAP “As Reported” numbers compared to what is TRUE. Understanding these discrepancies and what they mean for the future of a company can lead to massive gains, even on safe stocks.

Our team of more than 100, including financial analysts and accountants, analyzes the entire universe of U.S. stocks using our brand of forensic accounting. We load all of this data into what we call The Altimeter and then we filter these stocks to find the 200-plus companies with major discrepancies between what almost everyone thinks is true versus what is really true with a company’s earnings.

Once we have a list of 200-plus companies, we run an earnings call forensics on those to boil it down to a list of about 30 stocks that have massive upside potential. We literally analyze earnings calls to identify any deception, evasion, or excitement generated by CFOs and CEOs. This final piece gives us additional clues as the future of the stock’s price by further separating fact from fiction.

We then sort the 30 or so remaining stocks by size and volatility. With Hidden Alpha, we are seeking large-cap, safe stocks that still have the opportunity for big gains. In our other service, High Alpha, we focus on very small-cap stocks that can deliver the largest upside potential but tend to have more risk.

In each monthly issue of Hidden Alpha, we publish the stock that offers our subscribers the safest and best chance at doubling their money. In each issue, we give you the stock symbol and explain exactly what discrepancies we’ve uncovered and what form of excitement or deception markers, if any, that we might’ve seen in the earnings call forensics. And of course, we recommend how to proceed in your own account to take full advantage of the situation.

Click here to subscribe to Hidden Alpha.

Joel Litman

Sign up to receive Altimetry Daily Authority straight to your inbox.