Four trends in earnings events attendance

Investors interested in earning events attendance trends

Clients often ask us how their earnings event attendance compares to their peers. It’s a tough question to answer, and there are a few factors that impact a person’s decision to attend any particular company’s earnings event. 

More significantly, although the number of attendees can be important, who is attending is often more valuable information. When a company can identify the characteristics of their event attendees, they can ensure that they are prepared to communicate their story effectively and highlight their value proposition to the right prospects.

We looked at over 4,300 earnings events from more than 1,000 companies of all market cap sizes and sectors to identify trends and predict event attendance and demographics. 

Market capitalization

One major factor we identified was the organization’s market cap. Large-cap companies are generally more well-known, have an established business model, and have a history of performing well on the market. Large companies are more mature and less volatile in rough markets, as opposed to small companies, which can be seen as riskier investments without a proven track record. 

Additionally, it’s common that larger-cap companies have a more extensive shareholder base, and more investors are interested in keeping up with the company’s performance by attending an earnings call. The inverse is also true; smaller-cap companies tend to have a smaller shareholder base, especially considering institutional investors.

Trend in Earnings event attendees by market cap
Trend in Earnings event attendees by market cap

Looking deeper into how attendance may have changed since Q3 2022, market data shows a higher number of attendees for mega and large-cap companies, whereas smaller-cap companies are seeing a decrease, if not a significantly slower increase in the number of attendees for their earnings events.

Attracting institutional investors

For smaller companies trying to attract investors, institutional investor attendance can be important to identify leads for sources of investment. Most nano/micro-cap companies have a small proportion of institutional investors (30% or less). Institutional investors generally carry higher capital for investment and may be considered higher priority targets.

For larger companies, the presence of institutional investors shows a market interest in the company. With higher capital available, they can buy larger proportions of ownership in the company and have more of an influence on stock price and decisions regarding corporate governance. 

Change in proportion of institutional investors attending earnings events by market cap

The trend over the 14-month period analyzed shows an increase in institutional investors across all market caps. As these types of investors benefit all ranges of cap size, all IROs seeking to cater to this audience must consider how they can optimize the data that they collect to create a premier investor experience. 

Both large and small companies can benefit from a unified IR platform. It will enable them to tailor their communications specifically for institutional investors. In addition, it ensures that information is disseminated efficiently to existing institutional investors, keeping them engaged and informed.

Identifying activist investors

Barclays’ Investment Banking Shareholder Advisory Group’s review of 2023 activity identified 159 total activist campaigns through the third quarter of 2023. 

That’s 8% higher than the four-year average of 146. 

With this in mind, it’s especially important to keep an eye out for activist investors who may threaten the company’s current direction and leadership. IR teams need to be able to identify and understand the profile of all attendees of their earnings events and other corporate communications. This includes distinguishing between regular investors and activist investors who may have a significant impact on the company’s direction. 

Learn how advanced analytics within an IR platform can track investor behavior and sentiment and identify potential activists.

In our research, we found that while the total number of attendees is decreasing, the proportion of institutional investors in the audience for earnings events has increased for all sectors and all market caps across the board. This implies two things: 

  1. The reduction of attendees comes from retail or individual investors, who generally have lower amounts of capital to allocate and may be shifting to a safer investment strategy.
  2. Institutional investors are showing an increased (if not equal) interest in company earnings events. 

These insights are helpful in understanding how much interest there is in the company in relation to market trends and in evaluating the effectiveness of an IR program

Company perception and overall popularity

Finally, the perception of the company is the most significant factor in predicting how many attendees will join an earnings event. Simply put, companies that are more popular or in the news will have more attendees than those that are less popular. 

For example, we found that companies such as NVIDIA, Microsoft, OpenAI, and Google, which are closely involved in developing AI products, are seeing an increase in the number of attendees at their events. The market’s excitement regarding AI and its applications in the industry is clear in the number of investors who want to know what’s next in this rapidly developing industry.

But, it isn’t always excitement that brings attendees to earnings events. We saw the highly publicized collapse of Silicon Valley Bank (SVB) significantly increased interest in its rapid collapse.

In either case, as a predictor of attendance, popularity or being in the spotlight can help anticipate the size of the audience. However, it’s critical to consider — are these investors interested in the company, or just spectators with no investment intent? 

IR teams with the right tools should be able to gather the data necessary to see the difference. Attendees who have visited the company’s IR site, invested in similar sectors, and signed up for an earnings event are more likely to be potential investors and not just interested in sightseeing. When all that information is consolidated and evaluated on a single platform, IROs can make better-informed decisions.

For more insights into pre-earnings preparation, read “How IROs prepare for a successful earnings day” and see how our Q4 Platform can transform your earnings experience. 

You May Also Like