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Value Line

I have been reading Value Line for twenty years now and have been a subscriber of their service for the past decade. From the late 1980's to late 1990's, I didn't have enough money for the subscription and would go to the public library to read their reports and because most libraries carry Value Line, that option is still there for you, too. If you are not familiar with Value Line, it is a collection of research reports on 1,700 companies that are updated on a quarterly basis. Peter Lynch calls it "the next best thing to having your own private security analyst.". Warren Buffett says of Value Line: "I don't know any other system that's as good.". In his book One Up on Wall Street, Peter Lynch gives a pretty good description of what Value Line can do for you: "Value Line is easier to read than a balance sheet...It tells you about cash and debt, summarizes the long-term record so you can see what happened during the last recession, whether earnings are on the upswing, whether dividends have always been paid, etc. Finally, it rates companies on a simple scale of 1 to 5, giving you a rough idea of a company's ability to withstand adversity.".

Since the early 1930's Value Line has been publishing their research reports and they read like Cliff Notes combining the company's 10-K , 10-Qs and sell side analyst reports all bundled up in one nice package. Companies are broken up into industry segments like pharmaceuticals, biotechnology and medical devices and industry reports are updated quarterly along with the individual security summaries. Although I am currently investing in ETFs, I read the reports religiously to keep my watch lists updated in anticipation of getting back into the market at some juncture in the future.

Value Line enabled me to make a considerable amount of money before and after the dot com bust of the late 1990's and if you are interested in sampling some of their products, just go to their Web site and you will be able to download free Value Line reports of all 30 stocks in the Dow Jones Industrial Average. However, I want to state explicitly that although I made some serious coin with them, I also lost a considerable amount in the short run, too, because they didn't predict the dot com bust or the current real estate fiasco. Value Line is very good at giving approximate price appreciations for five year stretches, but they are not good market timers. As a long-term investor I have stuck with them because you can't fly on one wing. I need somebody to shine a light for me.

Sometimes Value Line gets a knock that they concentrate too much on the larger cap Blue Chip stocks, but that's a fallacy. Yes, they do review a large selection of Blue Chips, but they also have a sizable offering of mid cap and small cap stocks in their main investment survey. If you are interested in mid and small cap stocks, Value Line also has a service called The Value Line Small and Mid Cap Edition, but I don't recommend buying this because they don't provide enough research in these reports. What The Value Line Small and Mid Cap Edition gives you for a considerable sum, you can obtain on Yahoo Finance for free. If you are a short-term trader and are interested in the smaller high fliers, Value Line may not be your best bet, but Investor's Business Daily will do the trick.