Recast Investor takes published financial statements of listed public companies and recasts them to make them more simple.
We then analyse those recast accounts in comparison to the published accounts picking out items of interest to investors.
By doing this we enhance investor understanding.
If there are other material items in the statements that require further investigation then we'll do that too.
Modern financial statements are often very complex and can reach hundreds of pages in length. Who has the time or the skills to unpack all of that information.
Even fully qualified accountants or professional investors who have not trained as analysts can have lots of difficulty understand these documents.
Our aim is to reduce reports and statements to the most simple and understandable form to make the essentials of a company accessible to most people.
This kind of format makes decision making easier for investors.
Recasting is different than restating. The latter is used when financial information contains errors or fraud. Recasting, in contrast, reformats existing financial information in different ways.
We don't give financial advice but purely focus on analysis as would a journalist specialising in the stock market and business news.
From time to time we'll publish a book review of an exceptional book that we think can aid investors.
The stocks we cover are listed on and selected from the stock markets of New Zealand (NZX), Australia (ASX), the United Kingdom (LSE) & the USA (NYSE & Nasdaq).
Our Basic Recast Analyses are built around the following sections:
Revenue Statement
We recast this statement so that higher quality earnings are higher up the statement and the lower quality earnings such as unrealised gains and extraordinary items are lower in the statement.
We generate multiple earnings per share and price earnings ratios based on the different profit results.
Balance Sheet
We look at all comparative line items and note any material changes.
We take a hard look at intangibles and see if they are realistic.
Statement of Movements in Equity
We don't recast the comprehensive income statement as its contents usually appear in the movements in equity.
This statement is rearranged so that each year’s items are vertically down the page and can be understood far more easily.
Cash Flow Statement
The recast cash flow statement combines many of the line items that appear in the original statements.
Dividends are included in operating cash flow as they are a cost of capital (despite their payments being optional in most cases).
We use both the direct method and indirect method for stating operational cash flows the choice of which usually follows the original financial statements.
Ratio Analysis
We produce our our ratios including multiple earnings per share calculations.
Segmental Analysis
Many companies, usually for competition reasons, don't provide enough information for a comprehensive analysis of business segments but we produce what we can based on the information provided.
For our Deep-dive recast analyses we do the basic recast analysis as a start and then delve far more deeply into the accounts, the notes to the accounts and the management discussions.
The deep-dive analyses are only produced around monthly.