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Tuesday, August 20, 2019
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Wednesday, August 14, 2019
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Wednesday, August 7, 2019
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Thursday, August 1, 2019
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Tuesday, July 30, 2019
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Monday, July 29, 2019
Easy Fundamental Equity Analysis in Python

Monday, July 22, 2019
Calcbench Data and Tax Reform Insight

Wednesday, July 17, 2019
Downshifting in the Trucking World

Tuesday, July 16, 2019
New Report: Adoption of New Lease Accounting Standard

Friday, July 5, 2019
More Consequences of Lease Accounting

Monday, July 1, 2019
Another Example of Tax Reform Twisting Bottom Line

Thursday, June 27, 2019
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Tuesday, June 18, 2019
Popping the Lid on Smuckers’ Goodwill

Tuesday, June 11, 2019
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Wednesday, May 29, 2019
An Example of Calcbench, Excel, and Insight

Monday, May 20, 2019
Research Paper: Capex Spending

Thursday, May 16, 2019
Psst: Got Any Weed?

Wednesday, May 15, 2019
Open Letter: SEC Proposed Rule for BDCs

Friday, May 10, 2019
General Motors and Workhorse

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Acquisitions are a very common part of the business landscape. Some work out well, others not as well. Predicting which will be which is more of an art than a science. But you can (and should) use hard data to at least determine what is your downside risk as an investor in the case the deal goes south.

On Calcbench, we do this using our newest feature…fully interactive disclosures that link each number in the text with its corresponding detailed XBRL info. The power of this is it allows us to trace any of our standardized metrics back to its source text in the ‘paper document’. 

We’ll start by going to our Interactive Footnote Viewer ( and pick a list of companies to look at: the S&P 500 for example.

Next, choose the topic we’re interested in: business combinations. In particular, we’ll look at the goodwill ‘created’ when companies buy other companies. (Goodwill in accounting terms is the amount paid for a company above and beyond the actual assets of that company). There is goodwill resulting from most every acquisition. However, large goodwill numbers can be a red flag, because they may lead to large write-downs if the acquisition doesn’t work out as hoped. (Potential example here pertaining to Microsoft’s purchase of Nokia)

Choose the metric using our explorer:

Now, let’s go through the S&P 500 and see what we can find. Choose the “Portion of Purchase Price Allocated to Goodwill” metric, and our list will come up.

Aha! Without going very far at all, here’s a case where goodwill is over $1 billion, and over 50% of the purchase price. Now it is up to the analyst to decide if this is a risk or not. But it is certainly something to consider in analyzing this company. If this acquisition does end up falling short of expectations, you can expect some of this goodwill to disappear, which will take earnings down with it.

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