Information Sources & SEC Filings

Overview of Information Sources for Research Analysts

Research analysts are professional investigators of the financial world. Their primary responsibility is to gather, synthesize, and interpret vast quantities of information about companies, industries, and markets to produce investment recommendations. The quality of a research analyst's work depends directly on the quality and breadth of their information sources. Understanding where to find reliable data, how to evaluate its credibility, and how to extract actionable insights from complex filings is a foundational skill tested on the Series 86 examination.

Information sources for equity research can be broadly categorized into primary sources (direct, first-hand data) and secondary sources (data compiled, analyzed, or interpreted by others). Primary sources include SEC filings, company earnings calls, management presentations, and proprietary data collection such as channel checks and expert network consultations. Secondary sources include sell-side research reports, industry association publications, news media coverage, and third-party financial databases.

The most critical primary sources for any research analyst are the documents that publicly traded companies are required to file with the Securities and Exchange Commission (SEC). These filings provide standardized, audited, and legally required disclosures that form the backbone of fundamental equity research. The SEC's Electronic Data Gathering, Analysis, and Retrieval system, commonly known as EDGAR, is the centralized repository where all public company filings are freely accessible to anyone with an internet connection.

Beyond SEC filings, analysts rely on a wide ecosystem of data sources. Financial databases such as Bloomberg, S&P Capital IQ, FactSet, and Refinitiv provide structured financial data, consensus estimates, and screening tools. Industry-specific databases and trade publications offer sector-level insights. Government agencies including the Bureau of Economic Analysis (BEA), Bureau of Labor Statistics (BLS), the Federal Reserve, and the Census Bureau publish macroeconomic data that provides context for company-level analysis. Understanding how to navigate and cross-reference these sources is essential for producing thorough, well-supported research.

Annual Reports: Form 10-K

The Form 10-K is the most comprehensive document a public company files with the SEC. It is required annually and provides a thorough overview of the company's business, financial condition, and operating results. Unlike the glossy annual report that companies may send to shareholders (which is a marketing document), the 10-K is a standardized regulatory filing that follows a prescribed format and must be audited by an independent accounting firm.

The 10-K is organized into four major parts, each containing specific items that companies must address. Research analysts should be intimately familiar with every section, as they collectively paint the most complete picture of a company available in any single document.

Part I: Business Description

Item 1 — Business: This section provides a detailed description of the company's operations, including its products and services, markets served, competitive landscape, intellectual property, seasonality, regulatory environment, and the number of employees. For research analysts, this is the starting point for understanding what a company does and how it generates revenue. Analysts should pay close attention to changes in business descriptions from year to year, as they may signal strategic shifts.

Item 1A — Risk Factors: Companies must disclose the most significant risks that could adversely affect their business, financial condition, or operating results. This section is particularly valuable for analysts because it highlights the company's own assessment of threats. New risk factors or changes in the ordering of risk factors often signal emerging concerns that warrant further investigation.

Item 1B — Unresolved Staff Comments: If the SEC has provided comments on previous filings that remain unresolved, they must be disclosed here. The presence of unresolved comments may indicate accounting or disclosure issues that the SEC is scrutinizing.

Part II: Financial Information

Item 6 — Selected Financial Data: Provides five years of selected financial data, enabling trend analysis over a medium-term horizon. This section allows analysts to quickly identify growth rates, margin trends, and changes in capital structure without having to pull data from multiple filings.

Item 7 — Management's Discussion and Analysis (MD&A): Often considered the most valuable section for research analysts after the financial statements themselves, MD&A provides management's narrative explanation of the company's financial results, liquidity, capital resources, and known trends. The SEC requires companies to discuss material changes, unusual items, and forward-looking factors. Analysts should read MD&A carefully, comparing management's explanations to the actual financial data and to prior-year commentary to identify inconsistencies or changing narratives.

Item 8 — Financial Statements and Supplementary Data: Contains the complete audited financial statements (income statement, balance sheet, cash flow statement, statement of stockholders' equity) along with the notes to the financial statements and the independent auditor's report. The notes often contain critical information about accounting policies, contingent liabilities, segment reporting, pension obligations, and off-balance-sheet arrangements that may not be immediately apparent from the face of the financial statements.

Part III: Governance and Compensation

Item 10 — Directors and Executive Officers: Identifies the company's board of directors and senior management, including their backgrounds and qualifications. Understanding the management team is crucial for assessing the quality of corporate governance and leadership.

Item 11 — Executive Compensation: Details the compensation structure for the company's named executive officers, including salary, bonuses, stock options, and other compensation. Analysts evaluate whether executive compensation is aligned with shareholder interests and whether incentive structures encourage appropriate risk-taking and long-term value creation.

Part IV: Exhibits

Item 15 — Exhibits and Financial Statement Schedules: Lists all exhibits filed with the 10-K, including material contracts, subsidiary lists, certifications by the CEO and CFO under Sarbanes-Oxley, and the consent of the independent auditor. Material contracts can reveal important business relationships, revenue commitments, and potential liabilities.

Filing Deadlines

The filing deadline for the 10-K depends on the company's filer status:

• Large Accelerated Filers (public float of $700 million or more): 60 days after fiscal year end
• Accelerated Filers (public float of $75 million to $700 million): 75 days after fiscal year end
• Non-Accelerated Filers (public float under $75 million): 90 days after fiscal year end

Quarterly Reports: Form 10-Q

The Form 10-Q is filed for each of the first three quarters of a company's fiscal year (the fourth quarter is covered by the annual 10-K). While less comprehensive than the 10-K, the 10-Q provides timely interim financial information that is essential for tracking a company's performance between annual reports.

Key differences between the 10-Q and 10-K include:

• Unaudited financial statements: The 10-Q contains unaudited (though reviewed) financial statements, whereas the 10-K contains fully audited financials
• Abbreviated MD&A: The quarterly MD&A focuses on changes since the most recent fiscal year end rather than providing a comprehensive overview
• No Item 1A (Risk Factors) update required: Though companies may voluntarily update risk factors in the 10-Q
• Condensed financial statements: The balance sheet, income statement, and cash flow statement are presented in condensed form with fewer line items

Despite their abbreviated nature, 10-Qs are critically important for research analysts because they provide the most recent snapshot of a company's financial performance. Analysts compare quarterly results to their own estimates and to consensus expectations, looking for positive or negative surprises that could affect the stock price. They also examine sequential trends (quarter over quarter) and year-over-year comparisons to identify acceleration or deceleration in key metrics.

Filing deadlines for the 10-Q:

• Large Accelerated Filers: 40 days after quarter end
• Accelerated Filers: 40 days after quarter end
• Non-Accelerated Filers: 45 days after quarter end

Current Reports: Form 8-K

The Form 8-K is a "current report" that public companies must file with the SEC to announce major events that shareholders should know about. Unlike the scheduled 10-K and 10-Q filings, 8-Ks are filed on an as-needed basis, typically within four business days of the triggering event. For research analysts, 8-K filings are often the first formal disclosure of material corporate events and can have an immediate impact on stock prices.

Common events that trigger an 8-K filing include:

• Entry into or termination of a material definitive agreement (major contracts, mergers, acquisitions)
• Completion of an acquisition or disposition of assets
• Creation of a direct financial obligation (new debt issuance, credit facility drawdowns)
• Triggering events that accelerate or increase a direct financial obligation
• Changes in the company's certifying accountant (auditor changes can be a red flag)
• Non-reliance on previously issued financial statements (restatements)
• Changes in control of the registrant
• Departure or appointment of directors or principal officers
• Amendments to the articles of incorporation or bylaws
• Results of operations and financial condition (earnings releases are often filed as 8-K exhibits)
• Regulation FD disclosures (material information provided to select individuals must be simultaneously filed)

Proxy Statements (DEF 14A)

The proxy statement (officially known as Schedule 14A or DEF 14A for the definitive version) is filed before a company's annual shareholder meeting. It provides shareholders with the information they need to make informed decisions on matters to be voted on at the meeting. For research analysts, proxy statements are a goldmine of governance and compensation data that is not available in any other filing.

Key information found in proxy statements includes:

Executive Compensation

The proxy provides the most detailed breakdown of executive compensation, including the Summary Compensation Table, which shows total compensation for the CEO, CFO, and three other highest-paid executives. This includes base salary, stock awards, option awards, non-equity incentive plan compensation, changes in pension value, and all other compensation. Analysts use this data to assess whether management incentives are properly aligned with shareholder interests and to compare compensation levels to peer companies.

Board of Directors

The proxy discloses information about each director nominee, including their qualifications, independence status, committee memberships, attendance records, and any related-party transactions. Board composition, independence, and diversity are important governance factors that analysts evaluate when assessing a company's overall corporate governance quality.

Related-Party Transactions

Companies must disclose transactions between the company and its directors, officers, or significant shareholders. These transactions can represent potential conflicts of interest and may indicate governance weaknesses.

Shareholder Proposals

Shareholders who meet certain ownership thresholds can submit proposals for inclusion in the proxy. Analysts track shareholder proposals to gauge investor sentiment on governance issues such as board declassification, executive compensation reforms, environmental policies, and political spending disclosure.

Other Important SEC Filings

Insider Trading Reports (Forms 3, 4, and 5)

Corporate insiders (officers, directors, and beneficial owners of more than 10% of a company's equity securities) must report their ownership and trading activity to the SEC:

• Form 3: Initial statement of beneficial ownership, filed within 10 days of becoming an insider
• Form 4: Statement of changes in beneficial ownership, filed within two business days of a transaction. This is the most commonly monitored insider trading form, as it reveals real-time buying and selling activity by insiders
• Form 5: Annual statement of changes in beneficial ownership that were not previously reported on Form 4 (certain exempt transactions)

Research analysts closely monitor insider trading activity because it can provide signals about management's confidence in the company's prospects. Significant insider buying, particularly by the CEO or CFO, is generally viewed as a positive signal, while widespread insider selling may be a cause for concern (though it is important to consider that insiders sell for many reasons unrelated to their outlook on the company).

Schedule 13D and 13G

When an investor acquires beneficial ownership of more than 5% of any class of a company's equity securities, they must file either a Schedule 13D or 13G within 10 days. Schedule 13D is required when the investor has an activist purpose (intentions to influence or control the company), while 13G is a shorter form available to passive investors. Analysts monitor these filings to identify activist investors building positions, which can be a catalyst for stock price changes.

Registration Statements (S-1, S-3)

Companies file registration statements when they plan to issue new securities to the public. The S-1 is the most common form for initial public offerings (IPOs) and contains comprehensive information similar to a 10-K plus additional details about the offering. The S-3 is a shorter form available to established public companies for follow-on offerings. Analysts review these filings to understand the terms of new security issuances and their potential dilutive impact on existing shareholders.

Financial Databases and Industry Reports

While SEC filings provide the foundation for equity research, analysts supplement this primary data with information from financial databases and industry-specific resources. These tools allow analysts to aggregate, compare, and analyze data across companies and industries efficiently.

Financial Data Platforms

Professional financial data platforms provide structured data, analytics tools, and real-time market information that are essential for modern equity research:

• Bloomberg Terminal: The most widely used platform in institutional finance, providing real-time market data, news, analytics, and communication tools. Bloomberg's data covers equities, fixed income, commodities, currencies, and derivatives across global markets.
• S&P Capital IQ: Provides fundamental financial data, company screening, and comparable company analysis tools. Particularly strong for historical financial data and peer group analysis.
• FactSet: Combines financial data with portfolio analytics and reporting tools. Popular among buy-side analysts for its integration capabilities and custom reporting.
• Refinitiv (formerly Thomson Reuters): Offers comprehensive financial data, news, and analytics. The Eikon platform provides real-time market data and fundamental analysis tools.

Industry Reports and Trade Publications

Industry-specific information helps analysts understand the competitive dynamics, regulatory environment, and growth trends within a sector:

• Industry research firms: Organizations such as Gartner (technology), IHS Markit (energy and automotive), and Nielsen (consumer) provide proprietary research and data
• Trade associations: Industry groups often publish data on market size, growth rates, and regulatory developments
• Government agencies: The Bureau of Economic Analysis (GDP data), Bureau of Labor Statistics (employment and inflation data), Federal Reserve (monetary policy and financial data), and Census Bureau (demographic and economic survey data) provide authoritative macroeconomic information
• Academic research: Peer-reviewed journals and working papers from organizations like the National Bureau of Economic Research (NBER) provide rigorous analysis of economic and financial topics

Primary Research Methods

Beyond public filings and databases, research analysts conduct primary research to develop differentiated insights:

• Management meetings: Attending investor days, conferences, and arranging one-on-one meetings with company management (subject to Reg FD requirements)
• Channel checks: Speaking with customers, suppliers, distributors, and competitors to verify or challenge management's claims about business trends
• Expert networks: Consulting with industry experts who can provide context and perspective on market dynamics, competitive positioning, and technology trends
• Site visits: Touring manufacturing facilities, retail locations, or other company operations to gain first-hand understanding of the business
• Earnings call analysis: Listening to quarterly earnings conference calls and reviewing transcripts to understand management's tone, emphasis, and forward-looking commentary

Evaluating Information Quality

Not all information is created equal. Research analysts must develop a critical eye for evaluating the reliability, timeliness, and relevance of their data sources. Several key criteria should guide an analyst's assessment of information quality:

• Source credibility: SEC filings carry the highest credibility because they are legally required, subject to audit (in the case of 10-K financials), and carry potential liability for misstatement. Company press releases and investor presentations, while useful, are inherently promotional and should be verified against filings.
• Timeliness: Financial data has a shelf life. Quarterly data becomes progressively less useful as time passes, and annual data should be supplemented with more recent quarterly information whenever available.
• Consistency: Reliable information should be internally consistent and consistent with other sources. When an analyst identifies inconsistencies between different data sources or between management commentary and financial results, it warrants further investigation.
• Completeness: Analysts should be aware of what information is NOT disclosed and consider whether omissions may be material. Companies have some discretion in what they disclose beyond minimum requirements, and selective omission can be as informative as the data that is provided.
• Objectivity: All sources have potential biases. Company management has an incentive to present results favorably. Sell-side analysts may face conflicts from investment banking relationships. Even independent data providers may have methodological biases. Understanding these biases helps analysts appropriately weight different sources.