Corporate Eye

All posts in Investor

why-invest

The Tale of the Big Why

I’d like to start this blog entry with a request for money. What’s that? You want to know why I want money. Well, I’m looking for investors in my business. What’s that again? You want me to make an investment case. No problem. If you just head over to my company website, you’ll find… hold on a moment.

It’s unlikely that anyone would play down the significance of the … Read the rest

guidance


In the past two posts, I’ve examined the investor relations minefield commonly known as guidance – the practice of telling investors what you think future earnings may be.

It is a practice fraught with difficulties, not least of which is that companies often get it wrong. The business of forecasting is, by its very nature, an uncertain one, and the opportunities to go astray are numerous.

However, because the market is focused on future cash … Read the rest

In my last post I wrote about the uncertainty surrounding the thinking about whether or not companies should engage in the practice of giving guidance to investors. Of course what it boils down to is a careful examination of the factors surrounding each company’s situation. And while this sounds like a bunch of waffle language coming from a cautious lawyer, I believe there are some general guidelines that can help companies think through the … Read the rest

direction

Today I want to move from discussing the general aspect of communications in investor relations to one type of communications in particular, that of guidance. 

In a number of ways, companies giving guidance, either on expected revenues or profits, is a mug’s game. If a company gives guidance, and it hits the projected numbers, then they get no credit for it. On the other hand, if the company misses the numbers it guided to, investors … Read the rest