How Interviews Can Lead to 80% Investment Returns

The above excerpt from Cable Cowboys discusses John Malone's experience as a consultant at McKinsey. Malone went on to become a billionaire deal maker in the cable industry, and his observations about what consulting entails are spot on....It's not rocket science.

At 8C Partners we've found interviewing people and primary research to be the drivers of some of our most interesting findings. Whether it be interviewing employees, competitors, suppliers, or other industry participants, once you've talked to a few dozen players a picture starts to emerge about a company or industry.

Having an outsiders perspective also helps consultants approach a topic without preconceived notions. A great example of this is our research on Heckmann - now Nuvera Environmental Solutions (NYSE: NES). While the market bought into management's story that sales would be able to maintain a steady clip our extensive work interviewing industry players painted a different picture. We were able to foresee NES missing earnings expectations and disappointing the market. The company went from over a $1 billion market capitalization to below $200 million today (over an 80% drop in price). Below is a chart of NES stock price from the writing of our report to today (July 6, 2015).

Nuverra Environmental Solutions Inc (NYSE:NES)

Nuverra Environmental Solutions Inc (NYSE:NES)