Corporate Eye

How to show the relationship between stock price and events

Unless your company is very new indeed, there will be a history of rises and falls in the share price. Investors – both existing and potential – will want to understand this history.
Benetton stock chart
Some companies explain this by linking peaks and troughs on the share charts to press releases or RNS releases which cover the events related to the change.

Benetton is an example of this style of presentation; clicking on one of the markers on the line graph brings up a link to that release.

There is an argument that says that this might be misleading, and that the press releases may not be directly related to the changes in share price. This is possible, of course, and you would want to be able to select which category of press releases to use … otherwise the share charts may be overwhelmed with irrelevant links, and become illegible.

Stora Enso stockStora Enso use a provider (Quartal Flife) that enables not only Stora Enso releases to be linked to from the stock charts, but also dividend announcements and financial events.

You can see the line of small red/blue blocks under the top line graph – clicking on each of these brings up a list of linked pages which can be visited if desired.

TNT stock chartTNT use the same provider, and have this tool set up in such a way that third party news is also recorded on the share chart. Now that is interesting, and could be very revealing.

For both Stora Enso and TNT, the visitor can select which items they wish to see linked to the chart – from none to all. (I’ve circled the options on the TNT large image for you to see).

Another way of documenting and explaining at least part of this history is to provide a page explicitly dedicated to explaining the changes.

Genentech stock timelineGenentech provide a page called Stock Events Timeline, which provides historical information about corporate actions related to the stock.

UBS timelineUBS do something very similar on their Corporate Actions page.

It would be interesting to see a chart on these pages revealing what was the impact on the share price, if any, but this type of page does help explain what has happened to the stock as a result of company decisions in the past.

Do you explain what triggered the changes in the value of your stock?

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Lucy is Editor at Corporate Eye
 
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