For better or worse, I watch the Antiques Roadshow religiously. While I love to see the appraisers enlighten someone’s day with an unexpected evaluation, I also like to watch people’s reactions when they find out the family heirloom wasn’t given to their great-great-great-grandmother from George and Martha Washington…and that it’s a forgery. Not that I like to see their disappointment, no, what I listen for is their reaction. Sometimes the owners put on a brave face, while others are dubious of the expert’s claims. My favorite though is the person who doesn’t really care, they still like the item and it will continue to have a place of prominence in their home.

I admire those antique hunters who love their items regardless of its value. Having said that…do a little research and you probably won’t get burned.

I think the same holds true for the stock market. Research a company you’re interested in; do your own due diligence and chances are you won’t get taken in by a highly speculative dud. As an astute investor, you need to look at the business prospects, don’t let your emotions lead the way.

And those idioms were put to the test last Friday (March 24) when Wendy’s International spun off its Canadian coffee and doughnut icon Tim Hortons Inc. in the largest initial public offering (IPO) in more than half a year.

The first-ever share offering was initially priced at $27 in Canada. But when trading opened on the TSX, the shares went as high as $37.99 before pulling back to close at $33.10.

Shares also began trading on the NYSE where a similar surge was seen. The U.S. listed shares closed up $5.01 at $28.17. Between the TSX and the NYSE, a total of 44.2 million shares exchanged hands – more than the 29 million shares that hit the market.

But was Friday’s grab worth the buzz – were investors interested in the facts, were they buying on emotion, or a little bit of both?

Part of Tim Hortons appeal in Canada may be its combination of two of the country’s passions: doughnuts and hockey. A professional hockey player, Tim Horton started the chain in 1964 to make money in the off season. In 1974 he was killed in a car accident after a Buffalo-Toronto NHL game. And so began the legend of Tim Hortons.

It’s a well known fact that Canadians go to Tim Hortons after or instead of, work, school, and church. In fact, per capita, Canadians consume more doughnuts than any other country in the world; three times as many as Americans.

Those may be encouraging statistics, but investors need to be aware of the competition and market condition; not all doughnut stocks have fared well. Shares of Krispy Kreme Doughnuts have fallen about 85% from their 2003 high, to around $7.50 per share.

That said it’s also a well known fact that fundamentally, Tim Hortons has been performing exceptionally well.

According to Wendy’s latest earnings report, Tim Hortons recorded revenues of $1.2 billion last year. Although Wendy’s has 2.5 times more outlets, its revenue was barely twice that of Tim’s. Even more significantly, in pure dollars, Tim’s profits outstripped Wendy’s by more than $50 million.

Over the past five years, the number of Tim’s outlets has jumped nearly 50% to more than 2,600 in Canada and nearly 300 in the U.S. The company has plans to increase the store count to 4,000 in Canada and 500 in the U.S.

While some analysts think Tim Hortons is a gold mine, others are not quite so optimistic. Some believe Tim’s growth has peaked in Canada and that it will never achieve a high level of success in the U.S. where Tim’s is just another food chain and not a national symbol.

Time will tell.

The point is…it doesn’t matter if the stock you’re interested in is trading for $0.50 or $30.00 - -you need to do exhaustive research on the company, and be objective. Find out what kind of market they operate in and who their competition is. Are they profitable, are their revenues up, are they expanding? Is there an emotional factor that could benefit/hinder their potential?

Granted, most small-cap stocks will not attract the kind of attention that Tim Hortons did. But you still need to be aware of the same factors, after all, it’s your money.

Remember, the better prepared you are, the less likely it is you’ll end up on the Antiques Roadshow with a stock certificate you think came over on the Mayflower.

Whitefoot is a writer that you can find at peterleeds.com who writes a commentary on the current state of the stockmarket. At peterleeds.com you can find in-depth analysis of the stock market and penny stocks . Get hot stock tips, and learn how to turn small investments into large profits. Review testimonials from current customers to find out how Peter has helped them with their penny stock picks .