After many years of disappointing results, investors lost interest in this company. Additionally, the company’s financial disclosures made it impossible to see all the changes going on “under the surface.”
The client (under NDA) was looking for someone to help them fix their sagging stock price, which was lagging behind their peers despite several quarters of beating consensus estimates.
Management had a history of over-promising and under-delivering, which we needed to correct. Also, the business model transition created a layer of opacity that only increased disclosure, and new KPIs could solve.
The client (under NDA) was looking for someone to help them fix their sagging stock price, which was lagging behind their peers despite several quarters of beating consensus estimates.
Management had a history of over-promising and under-delivering, which we needed to correct. Also, the business model transition created a layer of opacity that only increased disclosure, and new KPIs could solve.
After many years of disappointing results, investors lost interest in this company. Additionally, the company’s financial disclosures made it impossible to see all the changes going on “under the surface.”
For investors to feel comfortable owning your stock, they need to be able to go out into the field and perform primary research. Doing so will allow them to decide if they think your growth projections make sense.
While there are often many reasons why a stock is suffering, one of the easier fixes I see in my IR strategy practice is a change in the way my clients discuss their competition.
Read on only if you're willing to throw out what they teach you in business school. Namely, that stock prices are simply the market's representation of the discounted present value of a future stream of cash flows.
In the late 90s, a really good sell-side analyst might cover 8 or 10 stocks. They would be on every earnings call and would know every detail about every line in the model. Today however, analysts frequently cover 40 or more stocks.
