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Unlock the power of Uniform Accounting with select access to some of our best reports and analyses

Valens Starter™ is everything you need to begin tapping into the power and growth potential of Uniform Accounting-driven investing.

Get access to our weekly equity insights report, monthly macro analysis, and select access to our institutional-level Earnings Call Forensics, credit cash flow analysis, and in-depth securities analysis. Plus a copy of our breakthrough AI Ecosystem Report.

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Money managers who routinely outperform the market tend to agree on one thing: never trust as-reported financial statements to make investment decisions.

Unfortunately, if you’re like most wealth managers and PMs you’re stuck using reported earnings, P/Es, P/Bs and other performance and valuation metrics that stem from financial statements. This is what you’ll receive from Bloomberg, FactSet and other mainstream financial data providers.

However, it’s well documented that, around the world, important elements of as-reported corporate financial statements have become unreliable. As-reported assets, investments, debt, earnings, equity accounts, and even revenue have become unreliable representations of the reality of a company’s balances and activities, especially when you try to compare companies to one another.

Get excellent stock ideas from our weekly recommendations, such as these results after our buy recommendations.

LPLA up 157%
LPLA real corporate profits in blue (28% ROA)
LPLA “as reported” profits in orange (10% ROA)
NVT up 96%
NVT real corporate profits in blue (35% ROA)
NVT “as reported” profits in orange (5% ROA)
URI stock pick up 143%
URI real corporate profits in blue (15% ROA)
URI “as reported” profits in orange (7% ROA)

The problem stems from significant inconsistencies in accounting rules and the application of those rules in financial statements.

And we are not the only ones saying this…

Members of the governing accounting bodies of FASB and IASB have publicly called out these accounting issues. The SEC has stated there is a growing “erosion in the quality of financial reporting.” Expert accounting practitioners have highlighted GAAP and IFRS shortcomings.

Due to the inconsistencies present in the application of accounting rules and standards under GAAP and IFRS, earnings can be reported to go up when in fact a firm’s performance has faltered.

Price-to-earnings ratios show stocks to be expensive that are actually cheap. Margins, assets, capital expenditures, debts, and virtually all key financial performance indicators can be a far cry from an accurate representation of corporate activity.

This is why we pick stocks by using Uniform Accounting, our own set of 130+ proprietary adjustments to financial statements. This allows us to consistently and systematically understand the real corporate performance of companies, both historically and going forward. In addition to using more accurate information, we also apply fundamental analysis that studies a company’s competitive advantage, business lifecycle, management, credit and more.

Accounting experts and money managers agree:

“By making excessive or insufficient allowances for [extraordinary items], the net earnings may readily be under or overstated. A wide departure…suggests that an adjustment of the reported earnings may be necessary…” 
— Ben Graham, The Interpretation of Financial Statements, 1937

“In the zeal to satisfy consensus earnings estimates…wishful thinking may be winning the day over faithful representation…We are witnessing an erosion in the quality of earnings, and therefore, the quality of financial reporting.”
– Arthur Levitt, Chairman, SEC 1998

“Current financial reporting standards as outlined [in the accounting principles known as GAAP – “Generally Accepted Accounting Principles”] have fallen into disrepute as a means of understanding current operating performance.“
– Michael Kwatinetz, PhD, Azure Capital Partners, Forbes Midas List

“…analysis of reported earnings can mislead investors as to the real profitability of a Business.”
– Seth Klarman, Author of “Margin of Safety” and CEO of the Baupost Group

“Generally Accepted Accounting Principles are not truth or reality.”
–Martin Whitman, Third Avenue Funds

“Always restate financials when valuing companies.”
– Jean-Marie Eveillard, remarks at CFA Society of NY, 2005.
“Accounting is the language of practical business life… But you have to know enough about it to understand its limitations – because although accounting is the starting place, it’s only a crude approximation.”
— Charlie Munger, Berkshire Hathaway

“To be successful, you should concentrate on the world of companies, not arcane accounting mathematics.”
— Warren Buffett, Berkshire Hathaway

Valens has leveled the playing field and provides subscribers with better research built from adjusting the financial statements.

Research shows more than 130 adjustments can be necessary to balance sheets, income statements, and more to rectify the inconsistencies inherent to GAAP and IFRS accounting policies and create uniformity in financial reporting that allows for meaningful trend and peer comparison analysis.

The following are accounting and financial reporting inconsistencies that require adjustments to reach Uniform Accounting standards. This list is not comprehensive:

  • Research and Development
  • Pension Accounting
  • Extraordinary Charges
  • Tax Loss Carryforwards
  • Working Capital Cash Balances
  • Asset Life
  • Excess Cash
  • GDP Deflator Adjusted Gross PP&E
  • Operating Long-term Investments
  • Goodwill Impairment
  • Acquisition Adjustments
  • Asset Writedowns
  • Insurance Settlements
  • Dividend Income
  • Pre-tax Profit/Loss from Asset Sales
  • Pre-tax Profit/Loss from Investment Sales
  • Discontinued Operations
  • Restructuring Charges
  • Merger & Related Restructuring Charges
  • Non-operating Income/Expense
  • Lease Capitalization
Sign up for this monthly subscription and get recommendations that use the real corporate profitability of companies to select stocks.
Visa up 68%
V real corporate profits in blue (60% ROA)
V “as reported” profits in orange (12% ROA)
Shift4 Payments up 81%
FOUR real corporate profits in blue (60% ROA)
FOUR “as reported” profits in orange (3% ROA)
Fidelity Information Services up 81%
FIS real corporate profits in blue (65% ROA)
FIS “as reported” profits in orange (2% ROA)

Valens Research gives you comparable research analytics by applying adjustments to as-reported financials.

This objectively and systematically cleaned up accounting database focuses on key corporate performance and valuation ratios, derived market expectations for companies, and more. The modularity of Uniform Accounting data allows for customization of data points as well as granularity down to the Uniform balance sheet and income statement line item. 

What you get with Valens Starter™:

$95 per month

Valens Research - Valens Equity Insights Report - PNG - 7 26 24

Valens Equity Weekly Insights Report:

Our equity stock pick of the week – Valens Equities Weekly Insights (VEWI) – highlights the most compelling research the Valens team has written in the prior week, including Valens’ top picks, management sentiment trends, and aggregate trends in corporate communication and valuations. Our analysis uses both quantitative and qualitative tools, such as Uniform Accounting, Earnings Call Forensics, management alignment analytics, macroeconomic and fundamental research.

Valens Research - FA Alpha Pulse - PNG - 7 26 24

Valens Monthly Macroeconomic Report:

FA Alpha Pulse gives you a clear vision into the state of the current market and how best to navigate it – helping you improve your financial insights and saving you significant time.

  • focused on uncovering repeated patterns in data ahead of market movements, built off research into 150+ years of market cycles
  • Monthly report distills key data points to help understand the current market environment and likely developments in coming months
  • Helps identify investment risks and opportunities and aids clients in their asset allocation decisions
Valens Research - AI Ecosystem Mock-up - PNG - 7 26 24

Valens Special Reports

Get our popular Artificial Intelligence Special Report covering the Ecosystem of investment opportunity happening from AI, from the main users, to enablers, to data centers and more. We have used our Uniform Accounting data and fundamental research to understand which sectors and which companies will thrive. Plus, get our strategic acquirers report, our financially distressed company report and other helpful reports to help you profit.

Database

Get 1 stock analysis per month

Select one stock from our database monthly. You’ll get the same in-depth Performance Valuation, Credit Cashflow Prime, and full equity analysis available to our largest Institutional Clients.

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