Hani Shawwa, a producer for Reuters Insider, sorts through company statements during the 2010 Strictly Financials seminar in Phoenix.

The Donald W. Reynolds National Center for Business Journalism is offering 24 fellowships worth $2,000 each for four days of study in business journalism – Jan. 4-7 in Phoenix.

Fellowships cover training, lodging, materials and most meals. Fellows receive a $500 stipend to offset travel and other costs.

The seminars will occur during Reynolds Business Journalism Week at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication.

The journalists’ Strictly Financials seminar teaches the essentials of covering financials, from stock markets and bonds to financial statements and company research. | More on the Strictly Financials seminar

The Business Journalism Professors seminar will cover the essentials of teaching a hands-on, university course in business journalism. | More on the Business Journalism Professors seminar

The fourth annual, concurrent seminars (with 12 Fellows attending each one) will be led by award-winning professors and journalists, including Jimmy Gentry, journalism professor at the University of Kansas.

One highlight will be a discussion with the legendary investigative-reporting duo of Don Barlett and Jim Steele, along with the 2010 winners of the Reynolds Center’s Barlett & Steele Awards for Investigative Business Journalism.

Rachel Tobin Ramos, a 2010 fellow and business reporter for The Atlanta Journal-Constitution, said, “It gave me much more confidence in my financial reporting, has allowed me to ask better and smarter questions, and overall improved my coverage. I cannot thank the Reynolds Center enough for this amazing course.”

A 2008 fellow, Roger Desmond of the University of Hartford, won a university innovation award for starting a business journalism course. He said the award “came with some extra money for research and travel, and of course, I owe it all to you!”

TO APPLY, Deadline Nov. 1: For information on the two seminars, including how to apply online, go to the call for Strictly Financials or Business Journalism Professors.

Questions? E-mail Andrew Leckey, Reynolds Center president,or call 602-496-9186.

ABOUT THE CENTER
The Donald W. Reynolds National Center for Business Journalism, located at ASU’s Cronkite School, was launched in 2003. More than 10,000 journalists have benefited from its free training. A calendar of upcoming free workshops, as well as daily tips on how to cover business better, are at BusinessJournalism.org.

The Center is funded by the Donald W. Reynolds Foundation, a national philanthropic organization founded in 1954 by the late media entrepreneur for whom it is named. Headquartered in Las Vegas, it is one of the largest private foundations in the United States.

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Gary Trennepohl, president of Oklahoma State University-Tulsa

Gary Trennepohl, president of the University of Oklahoma-Tulsa, offered these potential stories to the Strictly Financials fellows, following up on the credit crisis and market crash of 2008:

• What is the future for the smart securitization of assets? Who will regulate them, and who will rate them?
• Is there another crash coming in the housing market?
• What will happen to commercial real estate? Some are calling it the next shoe to drop. Commercial property prices have declined 42 percent over the past two years. Fifty-five percent of commercial mortgages that will mature in the next five years are underwater, meaning the property is worth less than the amount of the loan. The delinquency rate in October was 5 percent, versus 1 percent a year ago. (These stats are from The Business Insider, Nov. 16, 2009: MIT statistics.) Most commercial real estate lending is done by local banks, who avoided the problems with mortgage-backed securities. How are banks in your area affected by commercial real estate loans? Is your pension fund, hedge fund or other institutional investor exposed to real estate losses?
• What happens when people walk away from their mortgages?
• Will another financial crisis ensue as mortgages are recast with more favorable terms for borrowers? This is one reason the government is so concerned about keeping interest rates low, which also means a weak dollar.
• Will the Federal Reserve regulate the market for credit-default swaps by forcing trading in them to an exchange? Who will regulate them? A credit-default swap is a contract between two entities called counterparties. The buyer pays premiums to the seller, who in return promises to pay the buyer if an underlying bond or loan defaults.

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Robin J. Phillips

For journalists, social-networking sites can be used as a communication tool, a source for news stories, a breaking-news platform, another place to publish content and a way to grow audience.

Robin J. Phillips, Web managing editor for BusinessJournalism.org, made those points to a combined lunch-time session of business journalists and business journalism professors during Reynolds Business Journalism Week.

“Twitter, LinkedIn and Facebook are just tools. We are the social media,” she said.

She noted that Twitter has carried the first reports of major news events, including the first photo of the USAirways crash in the Hudson River and the news of Michael Jackson’s death.

To get started, she suggests taking a look at what other business journalists are tweeting. Muck Rack has one of the better lists of business journalists who tweet. BusinessJournalism.org also maintains a list of business journalists on Twitter. See whom the journalists you like are following and follow them.

She offered several ways to search for sources using social media:

• An Arizona Republic reporter found 1982 graduates for a story on how college grads did in the last big recession by searching Facebook for those identifying themselves in their profiles as having graduated that year.
• www.search.twitter.com will search for specific words in tweets, such as unemployed, and can be parsed down to a specific geography by using the advanced search.
• HARO, or Help a Reporter Out, offers a way to get specific sorts of people to respond. Using an URGHARO, or urgent HARO, Megan K. Scott at The Associated Press was able to get several skiers to respond to a question about their helmet use within a matter of hours for a folo on Natasha Richardson’s death.

She advised that users of social media are looking for loyalty, news, instant impact and real people. She said to lead with the good stuff, write killer heads and be real.

More than 300,000 businesses are on Facebook alone, and some larger companies, such as Ford Motor Co. and Virgin America, have employees assigned to monitoring what’s being said by their customers on social media and responding to it.

You can follow the Reynolds Center on Twitter @BizJournalism.

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Speaking to Strictly Financial fellows, he says that the market is so efficient that it’s almost impossible to beat it.  New information is widely, quickly and cheaply available and is rapidly reflected in security prices.

There are two main camps of analysts of stocks:

• Technical analysts believe that all information about a security is reflected in its previous prices. They use past prices in an attempt to predict future price movements in the stock. They tend to be short-term traders and are sometimes called “the elves.”

• Fundamental analysts focus on accounting data and economic factors to calculate the true value of a stock. Most brokerage research reports are fundamental analysis. Warren Buffett is a fundamental analyst. They believe that the market is rational and that value is derived from expected earnings, dividends and cash flow.

In both cases, he says, the information that both rely on has already been incorporated in security prices.

He says investment income is maximized by holding a well-diversified portfolio over time and minimizing trading costs and search costs.

“The market is so scrutinized and so well-followed, it’s almost impossible to generate” a return greater than the market over time, he says.

“Nobody who is doing a legitimate investment business is going to be doing 20 percent a year” in returns every year, he says.

He also notes that daily stock stories that attempt to show a causal relationship between events and market movements are jumping to conclusions. He suggests stating what the market did that day and what other events occurred that day, but not saying one is the result of the other.

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Gary Trennepohl during Reynolds Week 2010

He suggests using these ratios to judge a company’s profitability.  For all, the higher the number, the better. They include:

• net profit margin = net profit after tax divided by sales. One way to increase this number is to reduce costs while keeping output the same. Another is to increase sales by raising prices or expanding into new markets or product lines.

• return on assets = net profit after tax divided by total assets. This is a measure of the return on the investment in the company. How does that compare to what someone could have gotten if he had put the money in a CD at the bank? This ratio measures how well the company is managing its assets.

• total asset turnover = sales divided by total assets.

Here are some other ratios that affect profitability:

• inventory turnover = costs of goods sold divided by inventory.  The higher the number, the better.
• accounts receivable collection period = accounts receivable divided by (sales/365 days) or sales per day.  A company would like it to be zero, but does it at least match the company’s collection period, usually 30 days?

And these ratios can help analyze how a company is financed. A company can sell stock or bonds to raise capital. Debt is generally cheaper than equity.

• debt ratio = total debt/total assets. A lower number is less risky. It will lie between 0 and 1.
• debt/equity ratio = total debt/total equity. This ratio gives the same info as the previous one, but the number is not bounded. Again, a lower number is less risky.
• equity multiplier = total assets/common equity. This tells us the impact of leverage on earnings.

And here’s a very important ratio: return on equity = net earnings (or earnings available to common shareholders) divided by common equity. It establishes the rate of return generated for common stockholders. The higher the number, the better, if it’s consistent through time. Fifteen to 25 percent is typical.

He also says to use  this profitability model to see how a company is generating profits. It is useful because it separates return on equity into three components:

• financial leverage (equity multiplier)
• operating efficiency (net profit margin)
• asset utilization (total asset turnover)

Return on equity is a function of all three factors. Return on equity equals net profit margin (or net profits/sales) times total asset turnover (or sales/total assets) times the equity multiplier (or total assets/common equity).

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STRICTLY FINANCIALS SEMINAR

MONDAY—Jan. 4, 2010
6-9 pm  – Fiesta Bowl-watching party on 16- by 9-foot screen  
Boise State vs. Texas Christian University
Optional social function with beer, wine and snacks
Forum, 2nd Floor, Cronkite School

TUESDAY—Jan. 5
8:30 am  -   Welcome, ASU President Michael Crow, Andrew Leckey
9 a.m. -  “Today’s Business Journalists as Investigators,” Walt Bogdanich
10:30 a.m. -    “Understanding Markets,”  Jimmy Gentry
Noon  -  Box lunch with Walt Bogdanich   
1:30 p.m. -  Continue “Understanding Markets,”Gentry    
3:30 p.m. – Conclude “Understanding Markets” and “Sources,”  Gentry
5-5:30 p.m. – Cronkite Building Tour, Mike Wong

WEDNESDAY—Jan. 6
8:30 a.m. – “Financial Statements I,”  Jimmy Gentry
10:30 a.m. -   Continue: “Financial Statements I” and “Securities and Exchange Commission Filings,” Jimmy Gentry 
NOON  -  Awards Luncheon with Don Barlett and Jim Steele
“Reynolds Center’s 2009 Barlett & Steele Awards for Investigative Business Journalism”
Panel Discussion and Presentation of Awards

1:30 p.m. -   “Financial Statements II:  Tools for Analysis,”   Jimmy Gentry
3:15 p.m.  -  Continue:  “Financial Statements II: Tools for Analysis,”  Jimmy Gentry

THURSDAY—Jan. 7
8:30 a.m.  –   “Decoding Financial Statements,” Gary Trennepohl
10:00 – 5:00 -  Computer Lab open
10:15-10:30 a.m. Break – Computer Lab open
10:30 a.m.  –   Continue: “Decoding Financial Statements,” Gary Trennepohl
NOON  – LUNCH — “What You Need to Know about Using Social Media in Business Journalism,” Robin J. Phillips        
1:30 p.m.  -  Continue “Decoding Financial Statements,”  Gary Trennepohl
3:15 p.m.    “Investing in a Time of Uncertainty,”  Gentry/Trennepohl

FRIDAY—Jan. 8
8:30 a.m. -   “Credit Crisis and Market Crash of 2008:  What’s next?,”  Trennepohl    
10 a.m. –    Continue “Credit Crisis and Market Crash of 2008:  What’s next?,” Trennepohl

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One fellow was unable to attend, so the total number of fellowships during Reynolds Week was 23.

This year’s Fellows are:

STRICTLY FINANCIALS SEMINAR FELLOWS
• Debbie Blumberg, reporter, Dow Jones Newswires, New York
• Dave Dreeszen, business editor, Sioux City Journal, Iowa
• Lynn Ducey, staff writer, The Phoenix Business Journal
• Karina Frayter, business producer, CNN America, New York
• Joanisabel Gonzalez, staff reporter, El Nuevo Dia, Guaynabo, Puerto Rico
• Jason Hidalgo, business reporter, Reno Gazette-Journal, Nevada
• Brenda Krebs, Business Monday editor, The Miami Herald
• Rob Neill, business producer, MSNBC.com, Redmond, Wash.
• Jeanine Poggi, reporter, TheStreet.com, New York
• Rachel Tobin Ramos, business reporter, The Atlanta Journal-Constitution
• Hani Shawwa, TV producer, Reuters Insider, New York
• Emily Stanitz, producer, Bloomberg Television, Washington

BUSINESS JOURNALISM PROFESSORS SEMINAR FELLOWS
• Adrianne Flynn, Capital News Service bureau director, University of Maryland, College Park, Md.
• Emily Burch Harris, lecturer and student newspaper adviser, North Carolina A&T State University, Greensboro, N.C.
• James Kates, assistant professor, University of Wisconsin-Whitewater

• Herbert Lowe, professional in residence, Marquette U niversity, Milwaukee, Wisc.
• Ceci Rodgers, adjunct instructor, Northwestern University, Evanston, Ill. (Rodgers was unable to attend)
• Buck Ryan, associate professor, University of Kentucky, Lexington, Ky.
• Steve Schifferes, professor, City University, London, England
• John C. Schmeltzer, chair, University of Oklahoma, Norman, Okla.
• Claire Serant, assistant professor, St. John’s University, Queens, N.Y.
• Sheila L. Tefft, senior lecturer, Emory University, Atlanta
• Leslie Wayne, visiting professional, Arizona State University, Phoenix
• Nailene Chou Wiest, director, Global Business Journalism, Tsinghua University, Beijing

(The photos of the fellows, above, are left to right in alphabetical order. The 12 Professors Seminar Fellows are on the top two rows. The 12 Strictly Financials Seminar Fellows are on the bottom two rows.)

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The Donald W. Reynolds National Center for Business Journalism awarded 12 fellowships to its “Strictly Financials Seminar” for working journalists and 12 fellowships to its “Business Journalism Professors Seminar.”

Reynolds Week is held at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication, where the Reynolds Center is based.

These competitive fellowships, valued at $2,000, cover all seminar expenses.

“The dramatic increase in number of applications this year underscores the strong interest journalists have in improving their financial skills and the importance universities are now placing on business journalism,” said Andrew Leckey, president of the Reynolds Center. “It is an honor to have these fellows join us this January.”
The financials seminar covers stock markets, financial statements, options and SEC documents. The professors seminar covers how to teach a hands-on, university course in business journalism.

FOURTH ANNUAL EVENT

The fourth annual seminars will be led by award-winning professors and journalists, including three-time Pulitzer winner Walt Bogdanich, business investigations editor for The New York Times. Take a look at last January’s seminars.

A highlight will be a discussion with the legendary investigative-reporting duo of Don Barlett and Jim Steele, along with the awarding of trophies to the 2009 winners of the Reynolds Center’s Barlett & Steele Awards for Investigative Business Journalism.

Deadline to apply for the 2011 seminars is Nov. 1, 2010. More information is available at BusinessJournalism.org.

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3. The 2009 Reynolds Center fellows

The Donald W. Reynolds National Center for Business Journalism is offering fellowships worth $2,000 for four days of intensive study in financials and accounting Jan. 4-7, 2011, in Phoenix.  

Limited to 12 professional journalists with at least two years of business journalism experience, the fourth annual “Strictly Financials Seminar” will take place during Reynolds Business Journalism Week at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication.  

Gary Trennepohl, president of Oklahoma State University-Tulsa, speaks to business journalists at the 2010 Strictly Financials Seminar at Arizona State University. Photo by Molly Smith.

Fellowships cover the full cost of training, lodging, materials and most meals. In addition, fellows receive a $500 stipend to help offset travel and other costs.  

This seminar will cover the essentials of of covering financials, from stock markets and bonds to financial statements and company research.  

The sessions will be led by award-winning professors and journalists, including James Gentry, journalism professor at the University of Kansas. Gentry received the Barry Sherman Teaching Award from the Association for Education in Journalism and Mass Communication in 2008.  

A highlight of the week will be a panel discussion with the legendary investigative-reporting duo of Don Barlett and Jim Steele, along with the 2010 winners of the Reynolds Center’s Barlett & Steele Awards for investigative business journalism.  

In addition, journalism professors from around the country, who are attending a concurrent seminar on how to teach business journalism, will attend some classes with“Strictly Financials” Fellows.  

“We’re offering this seminar in answer to requests from many participants in our one-day workshops who want to raise their sophistication level in all the financial aspects of business coverage,” said Andrew Leckey, president of the Reynolds Center. “Spending a week digging into balance sheets and accounting should provide a real boost to every journalist’s expertise.”  

Janet Cho, a 2009 “Strictly Financials” Fellow and business reporter for The (Cleveland) Plain Dealer, said, “The greatest value of this seminar is how much more comfortable and confident I feel about tackling a company’s documents and analyzing a company’s financial health in a way that will be more meaningful for readers, investors and consumers.”  

The selection process is highly competitive, and applicants must provide by 11:59 p.m. PDT Nov. 1 at BusinessJournalism.org:  

• Contact information
• A resume
• A 100-word bio
•  500-word statement of why you are interested in attending the seminar, how it would improve your coverage and how you would share this knowledge with colleagues
• A letter of support from your editor recommending you for the seminar, explaining how your attendance would benefit the organization, and supporting your time away from work to attend. (Waived for freelancers.)

Don Barlett and Jim Steele

Here’s a look at what the fellows studied in 2010:  

REYNOLDS BUSINESS JOURNALISM WEEK  

AGENDA: “Strictly Financials Seminar”  

Phoenix, Ariz.  

Jan. 5-8, 2010  

TUESDAY—Jan. 5, 2010
 
8 a.m. Continental Breakfast—(Combined groups)— Forum
 
8:30 a.m. Welcome —(Combined groups)— Forum—ASU President Michael Crow, Andrew Leckey
 
9 a.m.“Today’s Business Journalists as Investigators” —(Combined groups)—Forum—Walt Bogdanich
 
10:15-10:30 a.m. Break
 
10:30 a.m. “Understanding Markets” —(Strictly Financials)— RM 314, 316—Jimmy Gentry
 
NOON Box lunch with Walt Bogdanich —(Combined groups)— Forum
 
1:30 p.m. “Understanding Markets” and “Sources and Records” —(Strictly Financials)—RM 314, 316—Gentry
 
3:15-3:30 p.m. Break
 
3:30 p.m. Continue “Understanding Markets” and “Sources and Records”—(Strictly Financials)—RM 314, 316—Gentry
 
5 p.m. Adjourn
 
5:15 p.m. Dinner —(Combined groups)—Forum
 
WEDNESDAY—Jan. 6, 2010
 
8 a.m. Continental breakfast —(Combined groups)—Forum
 
8:30 a.m. “Financial Statements I” and “SEC Documents” —(Combined groups)—RMS 314, 316—Jimmy Gentry
 
10:15-10:30 a.m. Break
 
10:30 a.m. Continue “Financial Statements I” and “SEC Documents” —(Combined groups)—RMS 314, 316—Jimmy Gentry
 
NOON Awards Luncheon with Don Barlett and Jim Steele—(Combined groups)—Forum
“Reynolds Center’s 2009 Barlett & Steele Awards for Investigative Business Journalism”—Panel Discussion and Presentation of Awards
 
1:30 p.m. “Financial Statements II” and “Tools for Analysis: Common Size” —(Combined groups)—RMS 314, 316—Jimmy Gentry
 
3-3:15 p.m. Break
 
3:15 p.m. Continue “Financial Statememts II” and “Tools for Analysis: Common Size”—(Combined groups)—RMS 314, 316—Jimmy Gentry
 
5 p.m. Adjourn
 
EVENING FREE
 
THURSDAY—Jan. 7, 2010
 
8 a.m. Continental breakfast —(Combined groups)—Forum
 
8:30 a.m. “Tools for Deeper Analysis” —(Strictly Financials)— Room 355—Gary Trennepohl
 
10:15-10:30 a.m. Break
 
10:30 a.m. Continue “Tools for Deeper Analysis”—(Strictly Financials)— Room 355 —Gary Trennepohl
 
NOON LUNCH — “What You Need to Know about Using Social Media in Business Journalism”—Forum—Robin J. Phillips—(combined groups)
 
1:30 p.m. “How to Analyze a Company”—(Strictly Financials)— Room 355 —Gentry/Trennepohl
 
3-3:15 p.m. Break
 
3:15 p.m. Continue “How to Analyze a Company”—(Strictly Financials)— Room 355 —Gentry/Trennepohl
 
5 p.m. Adjourn
 
5:15 p.m. Dinner—(Combined groups)— Forum
 
FRIDAY—Jan. 8, 2010
 
8 a.m. Continental breakfast—(Combined groups)— Forum
 
8:30 a.m. “Options and Futures” and “Investment Strategies”—(Strictly Financials)— Room 314 —Trennepohl
 
9:45-10 a.m. Break
 
10 a.m. “Options and Futures” and “Investment Strategies” —(Strictly Financials)— Room 314 —Trennepohl
 
11:30 a.m. Certificate Presentation —(Combined groups)— Forum
 
NOON Box Lunch/Adjourn —(Combined groups)— Forum
   

Questions? Contact Andrew Leckey, Reynolds Center president, at Andrew.Leckey@businessjournalism.org.or 602-496-9186.  

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2. Strictly Financials/Biz J Professors Seminars: Phoenix, Jan. 4-7, 2011
3. Call for Business Journalism Professors Seminar 2011

At the Chronicle, he regularly writes about the economy, labor issues, Fortune 500 companies and entrepreneurial startups.

Below he talks about sifting through documents, a typical day on the business beat and the stories he’s keeping an eye on in 2009.

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