Our models understand that this is not impactful disclosure:
“We face risks and uncertainties related to litigation, regulatory actions and government investigations and inquiries.”
But this is:
“The Company subsequently learned that the staff of the Division of Enforcement had previously opened an investigation.”
Our models understand that this red flag...
“For example, in September 2020, Nikola and our officers and employees received subpoenas from the SEC as part of a fact-finding inquiry related to aspects of our business as well as certain matters described in an article issued on September 10, 2020 by Hindenburg Research LLC, or the Hindenburg article.”
...is more important than this one:
“Separately, three purported Nikola stockholder derivative actions were filed in the United States District Court, against certain of our current and former directors, alleging breaches of fiduciary duties, violations of Section 14(a) of the Exchange Act, and gross mismanagement, among other claims.”
We automatically extract the same red flags that would be identified by an experienced analyst or forensic accountant.
A filing may have 2000 sentences. We'll show you the 20 that matter. Ranked.
"You're doing something really impressive."
~ Well-known forensic accountant and former CFRA analyst.
Our models achieve state-of-the-art results by leveraging the stories told in financial text.
Financial ratios only tell a small part of the story. The vast majority of information disclosed to the market is in the form of unstructured text. The choices of management, the relationships between entities, the nature of customers and suppliers etc. can only be discovered by "reading" financial disclosure. This is the information that makes or breaks a business.
AI models excel at quantifying the interaction of multiple variables.
Example: Company A has a CFO resignation and change in amortization policy, Company B has new related party transactions following a series of acquisitions. What is the likelihood of crisis for each?
Our models quantify risks for 80,000+ filings in our dashboard, helping you identify companies of interest.
How we do it:
We connect information to outcomes.
We understand how red flags interact and what that means for downside risk.