Chapter 13

Analyzing a Company’s Public Comments and Statements

IN THIS CHAPTER

Discovering what to look for from conference calls companies hold with analysts and investors

Finding out how to evaluate the importance and value of news coming from company executives

Uncovering what happens at annual shareholder meetings

Parsing through news about individual companies and stocks in media reports

Unless you belong to an exclusive country club, are in a Rolls Royce collectors’ club, or jet out to Davos for the World Economic Forum every year, you probably aren’t on a first-name basis with the CEOs of the companies you invest in. In fact, you might never have heard the CEOs’ voices, even though you’re entrusting them with your money.

With very few exceptions, most individual investors won’t get a chance to sit down face to face with a company’s CEO to discuss the future of the business. The relative unavailability of management to investors is one reason why a vast majority of fundamental analysis is based on closely examining a company’s written financial reports and regulatory filings.

There are times, though, when members of a company’s management team speak to investors. The most substantive meeting top-level executives have with investors is typically during analyst conference calls at the end of each quarter. These meetings, usually available to all investors on a limited basis, can contain critical pieces of information fundamental analysts need to be aware of. There’s also the ...

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