Playing Earnings: AEC

Alright, the moment of truth is at hand. I’ve sat here silently suffering in AEC, as multiple analysts have come out with downgrades based upon what strikes me as no deep or well-researched understanding of the company, and even less reasoning provided short of “people don’t seem to like the stock.”

Well, thank you, analysts, for those life altering insights. I could not POSSIBLY have reached that conclusion without your considerable prowess of surmising. I hope you’ll be well paid when AEC finally gets big enough to force your upgrade.

Tomorrow, AEC reports earnings. I am expecting:
1) no reported earnings per share (the losses are one of the attractions, for me)
2) level/consistent occupancy rates
3) increasing rental premiums/rates
4) massive cash flow INTO the company (I do not care about depreciation in a real estate company after a housing collapse, people)

In the face of those outcomes, I will declare absolute victory, and continue to march unrelenting at any analyst who dares quote standard metrics or moving averages as excuse to downgrade such a business. Should one of my assumptions fall, I will reassess, and perhaps begin offering apologies to those who, in hindsight, I shall have unjustly injured.

However, reading some of the opinions on AEC that have come out this last week and noting their unfamiliarity, I have some suspicions:

a) paid analysts are using standardized computer algorithms / interns to offer prepackaged opinions on small companies, without ever bothering to actually check their published conclusions. I understand, there’s only about 9 minutes in between the front and back nine…
b) all analysts springboard off one another’s findings, so a single analyst offering a mass produced opinion can create a waterfall of lockstep conformity

But hey, tomorrow’s just a night away. Let’s see who’s right…