As a small-cap fund manager I’m always on the hunt for new ideas. Typically these ideas arise from quarterly earnings calls of companies in my area of expertise.
But much to my surprise, new insights are increasingly coming from financial content (transcripts, presentations etc.) found exclusively on corporate investor relations websites.
In the past, I largely ignored IR websites. There was never much there. But in this age of transparency, companies, especially small-caps, are posting more and more substantive financial content there.
While this is a significant development for all investors it’s also puzzling in one very important way.
While public companies are always looking to expand the reach of their investment story and appeal to new investors, many do little with the vast, original content sitting largely undetected on their corporate IR websites. These sites typically attract little investor traffic – even as investors search vigorously for new stock investment opportunities elsewhere on the web.
I was reminded of this during a conversation last week with a top exec at a small-cap company I’m invested in.
After questioning the exec about his business I asked about the company’s plans to spread their message and attract new investors. The company has a powerful investment story that no one is paying attention to -- even as significant catalysts are on the horizon.
The small-cap exec told me that at present he’s only employing what would be considered traditional IR strategies. Unfortunately, none has proved terribly effective in moving his stock price higher.
What about online IR strategies? With so many investment analysis sites on the web (i.e. TheStreet), targeted opportunities to reach investors at scale should be readily available.
But, according to the small-cap exec, while no third-party investment site is being utilized for IR outreach purposes he was open to suggestions -- especially for disseminating the fantastic PPT presentation sitting on his IR website.
The Power of Content
The marriage of corporate IR website content and third-party investment analysis sites (i.e. TheStreet) is a remarkable match that benefits all involved: Public companies have unique content they want to share with investors everywhere and investors are looking for unique content to help them make investment decisions.
From investor presentations to annual meeting Q&A transcripts (and beyond), the financial content I’ve been finding on IR websites is substantive and actionable. Yet, investment analysis sites that should be begging to host that content are largely nowhere to be found. At the same time, these investment analysis sites are suffering as the quality of their content diminishes and traffic has largely plateaued. They’re desperate for the high-quality, original content needed to maximize pageviews and ad revenue.
If I were in the IR business, I would do anything to spread IR site content online – even if it meant paying a third-party investment analysis site to host it. That way, I could target investors exactly where they spend their time searching for new opportunities. I can’t imagine a better platform to identify prospective investors.
And, when you think about it, this sort of IR site content is ideally suited for investor relations marketing efforts across the web. It’s content that enhances the user experience on third party investment analysis sites by providing unique information investors desire.
IR pros are in an enviable position. They control substantial amounts of valuable original and actionable financial content on their IR websites. Bringing attention to that content by making it available on third-party investment analysis sites would go a long way toward expanding the reach of their message and exposing their investment merits to new investors.
Aside from Stocktwits, no investment analysis site has made a concerted effort to pursue IR pros and their treasure chest of financial content. Nonetheless, the investment sites all desperately want it. Because for ad-supported investment sites faced with slowing traffic and stiff competition there’s nothing better than original, actionable content.
IR pros have it, they’re incented to share it, and no doubt investors everywhere would benefit if they did.
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