Furthermore, when a problem comes to light, the company may not attract enough attention and investor concern to remedy the situation for shareholders. Big corporations like Kodak, IBM, and Travelers attracted turnaround management and buy out offers when they got into trouble. The same cannot be said for many poorly run micro caps. Research Fortunately, lawyers and investment bankers don't hold patents on due diligence. Doing in-depth research yourself can more than offset the lack of outside analysis and supervision.
Thorough research provides added dividends.
As analysts get to know their companies well, company managers may provide valuable business insights o names of other good companies to invest in. In-depth research is not intellectually difficult, but it does require a lot of leg work. In other words, it's simple, but not easy. At Babson, we start with historical audited financial statements. Then we find people who know the industry, including competitors, Wall Street analysts, customers and members of trade associations.