Misleading "Value" rating on failing companies and value traps
I appreciate the ratings you display for Value, Momentum, Price Revisions and so for, but your ratings embody a systematic error regarding Value. Specifically, failing companies and value traps often show an A or A+ for Value. In some extreme cases all the other ratings are F or D, and still Value appears as A or A+. I understand the method by which this occurs so I am writing to suggest that you revise the method to prevent this. Instead of an A or A+ you might show a rating that shows it can not be determined or is too risky or too stressed to value, perhaps a question mark. A simple rule might be that if all the other ratings are F or D, Value can not be rated. After all, with your ratings you are trying to represent the future, and future Value can not be represented.
Thanks,
Daniel Hochman
Director of Product, Seeking Alpha