Stock Ranks

21st Jun '17 by 007ellipsis

10 comments 5230 reads

I am a quality investor basing my investment principals on Greenblatts magic formulae with my own extra criteria such as negative debt and cash rich.
A few months ago I invested in a German company called Mut AG Messeraete Fuer Medicin.
M7U.
This company also had a stock rank of 99 that I also consider an important investment criteria.
The company's shares have gone up in value over 70% over the last 6 months.
Last week the shares started to drop significantly but I could find no news on any bulletin board or broker as to why.
Yesterday I noticed the stockapedia rank had dropped to from 99 to 0 for this share in a space of days so I immediately sold with a 60% return.
There has been no recent negative news posted on stockapedia or any negative rns.
My question to stockapedia and anyone else out there is what criteria has been used to suddenly assess this company and change its stock rank from 99 to 0 ?
That seems a bit overdone to me ?
Thanks in anticipation,
Stephen.

Unlock with Email

Unlock with Google

Already have an account?
Login here

ISAallowance

21st Jun '17

I think it's simply a bug, I've seen it happen to other German stocks previously for a day or so, then they go back to normal.

I also hold m-u-t AG BTW and had a look on their investor relations section for any news when it pulled back. I couldn't find any and concluded it was simply a pullback from an over-enthusiastic ramp up. ORBIS AG had a similar pattern recently.

Edward Croft

22nd Jun '17

Actually the reason this stock is unranked is that we're missing interim statements for it since 2007. The last complete interims received were on 2007-12-31. Our general rule for inclusion in the StockRanks is that we won't rank a stock without timely interim data. Unfortunately unless this company starts publishing complete interim data then we won't be including it in the StockRanks universe.

We should be publishing a flag about this to make this clear on the StockReport and publishing the StockRank as n/a rather than zero. I will see what I can do.

Looking back a few months I can see that we were originally ranking it. So something has changed here in the veracity of the underlying interim statements data. I'm not sure if it's a change in company process or something else, but we're investigating.

Latest half year report (Halbjahresbericht) available is 2016:

https://www.mut.ag/analysen-berichte/finanzberichte.html

007ellipsis

Thanks for the information.
I too could find no negative news or rns.
Ed Crofts comment that it's been marked down from a stock rank of 99 to 0 because it didn't post interim results is a bit over the top in my opinion.
I sold out because of this.
It would be better for stockapedia to re evaluate its stock rank in a more analytical way when this happens ?

I'm sure we could improve the process, but at the moment it's black or white. Either a stock qualifies for ranking or it doesn't. If the financial statements are incomplete or outdated then we don't have timely accurate data, so we can't rank the stock. If I was running a hedge fund using the same data, I'd use the same process.

I don't know why Thomson Reuters has marked these statements as incomplete, and as I don't read German I can't review the statements in depth personally. We'll get in touch with them and find out why the statements can't be marked as complete.

This does seem a very rare edge case. I've not seen 10 years of statements marked as incomplete before, so it's hard for me to comment why. Either there's a process error at Thomson Reuters or the company has restated its historic financials.

23rd Jun '17

Thanks Ed for the explanation.
I would really appreciate it if you can get an explanation from Reuters then possibly re rate the share accordingly.
Btw stockopeia is an excellent investing platform.
One last question is how fast do you post the latest news / rns on companies.?

JohnEustace

26th Jun '17

Ed,
Would it be better to display "n/a" rather than zero when the stock isn't being assigned a rating?

Rusty2

27th Jun '17

But this company was ranked until recently, how come Thomson Reuters are now saying that 10 years statements are incomplete? Interims have disappeared for 10 years?
I would rather see the ratings but then a warning about incomplete data (pending investigation), also the same with companies that are subject to a bid, several people have been caught out buying shares because they come up on screens or they shoot up the ranking because of a bid.

I would have bought shares in this company last year if my broker had them available.

Edward,
I notice that on B&B Tools AB all the data has gone, it was there earlier this month: http://www.stockopedia.com/share-prices/bb-tools-ab-STO:BERG%20B/

Is this an error?

Stock Ranks

Unlock the rest of this article with a 14 day trial

About the Author

007ellipsis

10 comments

Unlock the metrics for all these stocks and more...

Unlock the metrics for all these stocks and more...