Learn From The Leaders: How to Analyze Stocks on Seeking Alpha Premium | Lawrence Fuller

Hi everyone, I'm Lawrence Fuller. I'm the investment group leader for the Portfolio Architect which you can find on the Seeking Alpha Marketplace and I'm here today to show you how I use Seeking Alpha's premium platform to do my stock analysis and research. So, I'm going to share my screen here with you now. And I am going to review what is currently uh my largest position in portfolios and a company that actually is reporting earnings tomorrow morning which I'm hoping will be better than expected. Um what I want to start about start with is telling you that um the premium platform is evolved over time and what I find uh amazing is that uh there were a variety of other data aggregator platforms that I used to subscribe to, cost me a lot of money and one by one I've been able to uh cancel those subscriptions because I really find everything I need on this platform. So, I'm just going to show you some of the things that I look at routinely with my individual stocks. Now, with respect to GigaCloud, what I really like is the multiple ways I can access the information I need, but I'm going to start here just off the top by talking about um the rating summary over here. Now, what this does it gives you an idea of what SA analysts other SA analysts think of the stock as well as Wall Street analysts and then Steve Cress sees uh quant system which I don't abide by strictly, but I do find it quite useful. What I like to do here is click on the acknowledgement that I'll receive by email whenever there's a change either from an analyst or on Wall on a Seeking Alpha or from a Wall Street uh analyst or from the quant system. And I'll do that with the stocks that I'm following closely so I'm alerted to any change that might have occur. Um Now, it's really convenient here to have the viewpoints from other SA analysts uh many of whom I uh follow closely because they do great work, especially sector specific work. Um and then you just have the general news flow right here. The other thing I find uh valuable here are these factor grades which are how Steve comes up with his overall ratings. I like to see a positive progression here um especially over the the uh the near term. Any kind of upgrades or downgrades might alert me to uh dig a little deeper into uh why one has changed and um scrolling down a little further, I'm just going to go in the order as I go down the screen here. In terms of looking for other ideas, often times what I'll do is I'll with respect to a stock that I already own is I'll look at the sector rankings. And this gives me all the discretionary consumer discretionary stocks including GigaCloud, but I can scroll through here based on the highest quant ratings and often times find other names maybe I should consider based on the kinds of stocks that I look for. I'm I'm a GARP investor. I look for growth stocks at a reasonable price and so this gives me an easy way to scroll down and look for maybe stocks that are trading at relatively low multiples well below the market's PE of 21 times and um and then if I find one um I will dig a little deeper and see if I can't add that as a name to my watchlist of companies that I might want to purchase. So, let me scroll let me go back here to the main page. I'll just type in GCT again. And okay, working down the list here. Um as I keep scrolling down, the next thing I typically focus on with respect to revenue and earnings is I like to see a consistent uptrend in both which is easy to access here. I can look at it either on annual basis or quarterly basis and I can do the same thing with respect to earnings per share. You know, obviously we want to own stocks that are outperforming their estimates and this is a great way to look and see um what the rate relationship is between the actual numbers reported versus those that are expected and with GigaCloud they've been consistently outperforming. There was one soft quarter here in the fourth quarter and that was because of an acquisition they made so they had a charge that reduced the number, but overall have nice steady earnings beats here for the company. Um earnings revisions I want to own stocks that that have where analysts are up upgrading the estimates and we haven't had any revisions here with GigaCloud in the last uh in the last 3 months, but easy access here if I want to dig a little deeper. Again, um

this is uh this is not showing me any changes in estimates over the last 3 months, but when those do pop up, that's something that I want to focus on. Um The other things I find real valuable here uh you know, I'll go a little further down here uh multiples. Obviously uh GigaCloud trading at just 10 times this year's earnings. I like to find stocks that are growing at a faster rate uh than their multiple and um moving forward here, we do see that in 2027 we have a bigger earnings expectations drawn for GigaCloud. Um I think these numbers here 331 for this year are considerably lower than what they'll do. Um and uh as far as other data here, there's such a tremendous amount, but one of the numbers that I really focus is the return on equity in terms of profitability. Uh return on equity simply put is the net income of a company divided by shareholder equity which is assets minus liabilities. And that will range depending on sector, you know, in the utility sector a good ROE might be 5 or 6% whereas for a technology company that's asset light, it might be as high as 30%. Microsoft has a 30% return on equity. And what is stands out for me with respect to GigaCloud is that it also has a return on equity of 30%. Hugely profitable company. And um I want to see that well typically when I'm looking at stocks, this is one of the first thing I'll look at is to see what the return on equity is for the company. Again, acce accessible right on the home on the very first page here. Uh the other thing I focus on is capital structure. How much cash does the company have? How much debt does it In the case of GigaCloud here, tremendous amount of cash on the balance sheet and the lot the debt is or is really long-term leases from warehouses that they they used to house their large ticket items that they sell. So, there's virtually no debt on the balance sheet. And um other factors I'm going to look at here. Okay, insider buying and selling. Sometimes um you see if you see a lot of buying activity by insiders, that's generally a very positive sign. Just the opposite when you see sales unless you dig a little deeper and understand why. In the case of the selling activity going on for GigaCloud, as [clears throat] I've because I've been speaking to management on a fairly regular basis, um the founder Larry Wu here has been selling stock. He owns 20% of the outstanding shares and so he has been liquidating on a program basis to diversify his net worth which is completely understandable. The same goes for the COO who's been with GigaCloud from the start with when Larry founded the company. Um short interest Okay, 6 and 1/2%. Uh this has come down for GigaCloud from what was about 15% 6 months ago. So, that can also be a positive or a negative. In this case, given how strong the fundamentals are, I wish actually the short interest was a little bit higher than it is today, but um uh that would be more pent-up buying as the uh the fundamentals improve. But again, this is another number that uh I like to look at for any stock that I'm tracking or that I own. And then at the very bottom of the page here, I will often times uh the GigaCloud will report earnings tomorrow morning. I have several other companies that are reporting. I don't have a lot of time to sit there and listen to the conference calls. So, what I really love about this platform is I can go straight to the transcript right here. I can read through the questions that the analysts have asked, the responses from management and I can also click on the earnings presentation which is sometimes just as valuable to look at the metrics, see how they change and see what the outlook is uh for the company moving forward if anything has changed. So, uh last would be the um the SEC filings. I like to read the quarterly filings. They're typically much more extensive in detail than what you'll find in the present quarterly presentation or even on the earnings call. So, that's another thing that I'll focus on. And um the point here is that I have all this information just on one page and I don't have to jump around from one site to the other. So, um great information. I'll say another thing here that I really like is they have added this options page. You know, if you trade options, I typically just sell options. I like to sell covered calls. I'll select to sell uh naked puts purely for the purpose of income as opposed to speculation. And even though I can't trade uh these options on this platform, this is a lot easier for me to go and look and see what types of premiums am I collect as opposed to going to my brokerage accounts and accessing the trading screen. So, this is just a real quick example for example if uh

if Gigat has a really solid earnings report tomorrow, which I expect, and the stock spikes up into the 40s, I might want to look to sell some covered calls. So, what I can do right now is I can take a look and say the March or I'm going to drop down here to April and just consider what the 40s are selling for or the 45s. And it just gives me some early heads-up uh idea of which contract I might sell. Saves me a little bit of time. So, again, having that on this homepage is uh is really valuable. Um anyway, I think that is that's just a general over overview of how I use uh the homepage, but again, I could dig I could spend 30 minutes here digging through all these different uh tabs here to go deeper and deeper into the stock. And it's just been a phenomenal tool that's just seems to keep getting better. So, that's an example of how I use the uh the premium platform. And I hope you'll check out my uh my marketplace site, Portfolio Architect, and uh take a take another look at that and look at the uh the companies that I own as well as the ones that I'm watching. And with that, have a great day.