Smart financial analysis depends on access to data — lots of it, as soon as possible, ready to drop into whatever models you’ve cooked up on your computer screen.

As obvious as that idea might sound, however, the truth is that plenty of financial analysts struggle to achieve it because they don’t have an effective fundamental data strategy. So today we want to unpack exactly what such a strategy means, and how it can help with your daily work.

First question: Exactly what do we mean by a “fundamental data strategy?” That’s easy. It is the strategy of seeking out the data in corporate financial filings, rather than waiting for those filings and then reading them. That is, your goal is to obtain the financial data, rather than the filing that contains the data.

That might sound like hair-splitting, but it’s not. In the world of financial analysis, where even a few minutes can give you a competitive advantage over rivals, a fundamental data strategy can be crucial.

For example, Calcbench recently examined corporate filings submitted to the Securities and Exchange Commission from Oct. 12 to Nov. 11, 2022. We collected 3,386 “pairs” of earnings releases and their corresponding 10-Q or 10-K filings. On average, the lag from the earnings release to the 10-Q or 10-K was 2.6 days. See Figure 1, below.

Most of the 10-Q or 10-K filings in this period (more than 76 percent) were filed within two days of the earnings report, as seen in the histogram — but almost 20 percent of the SEC filings occurred more than four days after their earnings release was published. Included in this group were firms such as Blackrock, United Healthcare, JPMorgan, Wells Fargo and JB Hunt. Ten percent of the firms took 10 days or more to submit their quarterly SEC filings after their earnings release!

Moreover, the earnings release and the quarterly filing don’t necessarily contain the same data. Some companies cram their earnings release with non-GAAP disclosures that don’t make it into the 10-Q. Some include data in the 10-Q that isn’t mentioned in the earnings release.

A fundamental data strategy works by capturing all that data, in both earnings release and quarterly SEC filing, on an automated basis. That saves you the trouble of waiting for a company’s formal filing, and the risk of overlooking a critical piece of information that only exists in the other filings you’re not reading.

You can execute a fundamental data strategy in several ways. First, you can subscribe to a data provider such as Calcbench (what, you thought we wouldn’t give ourselves a shameless plug?) and use our numerous database tools to search the data as we scoop it up from corporate filings. Or, you can arrange for an API so the data we collect automatically flows into whatever models and tools you’ve developed in-house.

EIther way, you get what you need for successful financial analysis: data.

Calcbench did just publish a (free) whitepaper explaining fundamental data strategy in more detail, and we encourage you to download it and give it a read. Later this week, we’ll give a few examples of what we mean from specific companies.


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