Research from Water Tower Research, Water Tower Research

Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Research from Water Tower Research

Equity Research Firm

Thematic (Sector/Industry)

United states Financials / Thematic (Sector/Industry)

<ul><li>The WTR Consumer Index underperformed the S&amp;P SmallCap 600 in September, declining 2.5% versus the 2.7% increase in the broader market.</li><li>The change in 12-month prospective earnings was about the same for both, +0.1% for the WTR Consumer Index and +0.2% for the S&amp;P SmallCap 600, but the prospective P/E ratio for our index compressed 0.43x to 16.34x, while the broader index prospective P/E ratio expanded 0.41x to 16.58x.</li><li>Our index went from trading at a 4% premium to the market in August to a 1% discount at the end of September.</li></ul>

The WTR Consumer Index underperformed the S&amp;P SmallCap 600 in September, declining 2.5% versus the 2.7% increase in the broader market.The change in 12-month prospective earnings was about the same for both, +0.1% for the WTR Consumer Index and +0.2% for the S&amp;P SmallCap 600, but the prospective P/E ratio for our index compressed 0.43x to 16.34x, while the broader index prospective P/E ratio expanded 0.41x to 16.58x.Our index went from trading at a 4% premium to the market in August to a 1% discount at the end of September.

Consumer Monthly WTR Consumer Stock Index Lags the S&P SmallCap 600 in September and YTD