Chain Leader

David Farkas

Face Time
May 2, 2007

What do business reporters and Wall Street analysts have in common? For one thing, they ask management a lot of the same questions. And they’re obliged to write about the companies they follow.

Similarities pretty much end there. Sell-side analysts, whose job is to advise investment bank clients on which stocks to pick, must also arrange face-to-faces between company executives and inquisitive investors.

Last week, Senior Research Analyst Amy Vinson of Nashville, Tenn.-based Avondale Partners talked to me about this critical aspect of her work.

”Setting these things up [and] talking management teams into traveling is a huge part of my job. Institutional investors find it very helpful to sit down across a table from the management team,” she said.

“I can communicate the various stories only so well. I can explain the numbers and tell them what I believe the concept's role in the marketplace is, but hearing it from the company in a small setting is often the key to an investor's ability to understand the story.

“They have their own set of questions that they need or want answered, and they want the answers straight from the horse's mouth. They all listen to conference calls or read the transcripts, but that’s often not the forum for the questions they want to ask,” she added.

“There is no real list of dos and don'ts, but I do try and make sure that both sides of the table are well aware of the needs and wants of the other. Management teams that are prepared for the level of understanding or the investment style of the client are going to better target the presentation and the answers to questions.”

Posted by David Farkas on May 2, 2007 | Comments (0)