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OTC/Pink Sheet Companies


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I remember reading something somewhere that you could get a book with OTC/Pink Sheet companies in it, along with their basic financials.  Kind of like the Moody books Buffett used to go through.

 

Does anyone know anything about a product like this?  Or some other way of reading about a lot of OTC/Pink Sheet companies in kind of a Valueline like format?

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Yup.. Walkers Manual for Unlisted stocks.  The latest edition is from 2003 and as far as I can tell they're sold out online. 

 

Your best bet is probably going to a local library, I searched the Pennsylvania libraries and there's a copy at a library a few towns away.  Also check university libraries. 

 

Just a note probably 40% of the companies or more in there are no longer listed, so the biggest time sink is entering the ticker into otcbb.com just to see if the company even trades still.  The last 100 pages of the book are community banks, a lot of those banks have been swallowed up, and the metrics aren't really comparable to now.

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Isn't the financial information a little out of date though?  I'd be amazed if there wasn't some other source out there for this.

 

I mean all it is (coming from a software engineering background here) is data fetching and collating.  It shouldn't be that hard.  And I feel like there would be at least a small market for the product...

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Yes, in theory this is just fetching data and putting it in a nice readable format.  The problem is where does the data come from?

 

I would say probably 85% of the companies in Walkers are truly unlisted by that I mean the only way to get financials is to buy a share and call the CFO/COO and ask for them to mail you the most current annual report.  To complicate this a lot of the shares trade infrequently, so you will have all these bids sitting out there for months just trying to get information.

 

Another issue is some shares aren't cheap, like $1,000/sh and up.  There's the Indianapolis minor league team listed, their shares are $40,000/sh.  So you need to plunk down $40k, and hope your bid fills just to get the latest numbers.  What happens when you finally get your share and realize they're on death's door? 

 

The amount of work to compile a volume isn't cheap.  There are some other threads on this board that discuss this, just search Walkers Manual.

 

I've tossed around the idea, and still plan on starting up a small site where like minded unlisted investors can share relevant data for companies they're aware of.  Even something simple like a P/E or last year's dividend or cash flow is really helpful in narrowing down companies to research further.

 

I think this is a really good market if you want to get your feet wet with real research, and I mean thinking outside the box research.  For example I was able to find out about one company's land value by researching a bond offering by the local fire department.  The bond offering had the largest tax payers in the city and the company and their assessed value was listed. 

 

I try to write up really interesting companies that I find in Walkers on my blog (linked under my username).  I've ended up emailing with a group of investors who all invest in this same realm, I've traded some annual reports which is nice.  The funny thing is for the 400 companies in Walkers it seems that the cream rises to the top, I'd say most of the people I've talked to who invest in true unlisted stocks are all aware of the same 20-30 companies or so and are investors in different numbers of them.

 

As for your question about the Walkers data being old.  Yes it's old but it's useful.  So my theory was overcapitalized companies in 2003 would be overcapitalized now, that was right.  Companies that were quality then are still running at mostly the same level.  These are family businesses, the types of companies you'd see in a small industrial park in the Midwest.

 

I've got a small library of annual reports, I have had fills on three companies recently and since it's annual report season I'm just waiting for those to be mailed.  Am I insane? Maybe, I've got $290 tied up in companies that I know nothing about (1 share orders).  $290 is a lot to pay, so would I pay someone $100 to put this in a book, yes.  I don't think there are enough actual investors out there who are willing to do it though.

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Yup.. Walkers Manual for Unlisted stocks.  The latest edition is from 2003 and as far as I can tell they're sold out online. 

 

Your best bet is probably going to a local library, I searched the Pennsylvania libraries and there's a copy at a library a few towns away.  Also check university libraries. 

 

Just a note probably 40% of the companies or more in there are no longer listed, so the biggest time sink is entering the ticker into otcbb.com just to see if the company even trades still.  The last 100 pages of the book are community banks, a lot of those banks have been swallowed up, and the metrics aren't really comparable to now.

 

Interlibrary Loan... It is a great thing to ask about. I just call up my library and they make the request for me. Saves a ton of leg work. I actually got some Wall St Transcripts printed and sent to me that way (and those things can cost you)!

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why aren't shareholders simply putting annual reports online from those dark companies?

 

From what I've read and understand doing this is illegal, copyright infringement.  A company's annual report and quarterly reports are copyrighted material.  The figures inside are not, but the actual presentation and format are.

 

So this means if you took the figures in the annual report, transposed them and wrote up your own summary of the company it's fine.  If you just posted what the company published it's not.  This is how books can publish this information, it's the figures, and summary level info.

 

 

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why aren't shareholders simply putting annual reports online from those dark companies?

 

From what I've read and understand doing this is illegal, copyright infringement.  A company's annual report and quarterly reports are copyrighted material.  The figures inside are not, but the actual presentation and format are.

 

So this means if you took the figures in the annual report, transposed them and wrote up your own summary of the company it's fine.  If you just posted what the company published it's not.  This is how books can publish this information, it's the figures, and summary level info.

 

Yep, exactly.  Though an interesting possibility would be to develop a format and start a small, hybrid wikipedia where the cost of membership is putting out data for a company currently not in the database.  Of course, one could also pay a fee for access once there was enough momentum...

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