Guidance Practices & Trends FTSE 100

Transcription

1 Guidance Practices & Trends Research Report by EventVestor & IR Society October 2012

2 Guidance Practices and Trends - Highlights Less than 1 of companies provide quantitative EPS guidance. However, over of the companies provide guidance on operational metrics other than revenue, profit, and EPS. Overall, 65% of the companies provide some narrative directional guidance on EPS, revenue, profit, or other operational metrics. Among the companies that provide guidance, about 85% provide only annual or long term guidance ranging from 2 to 4 years. Among the companies that provide guidance, about have guided higher compared to about 12% of the companies that guided lower, since January This report is based on the analysis of companies guidance practices by EventVestor, the most comprehensive event-driven investment research and business analysis platform. The study includes all guidance announcements by companies in 2011 and 2012 YTD to the end of September. Guidance announcements were sourced from company press releases and other reports. Proprietary & Confidential 2

3 Guidance Practices and Trends Guidance Frequency Number of Companies Providing Guidance Number of Companies Providing Guidance #Companies #Guidance Events % 6% 86% 6 Months Guidance 3 Months Guidance Annual Guidance YTD EventVestor EventVestor 65% of the companies have announced guidance about 234 times in % of the companies have announced guidance about 171 times in 2012, to September. Time horizon of over 85% of the guidance announcements was annual compared to 8% of the guidance announcements for 6 months and 5% of the announcements for 3 months period. About 7% of the guidance announcements were long term ranging from 2 to 4 years. * Guidance includes EPS, revenue, profit, and other operational metrics and directional guidance Proprietary & Confidential 3

4 Guidance Practices and Trends Guidance Type 5 3 Percent of Companies Providing Guidance by Type 46% 43% 33% 37% % 14% 9% 5% Higher Lower Mixed Reaffirms YTD EventVestor 45% of the companies that provide guidance have guided higher in 2011 compared to about 12% of the companies that have guided lower. 43% of the companies that provide guidance have guided higher in 2012 to September compared to about 14% of the companies that have guided lower during the same period. 33% of the companies have reaffirmed their earlier guidance in 2011 compared to about 37% of the companies that have reaffirmed their guidance in 2012 to September. 9% of the companies in 2011 and 5% of the companies in 2012 have announced mixed (some metrics higher and some lower) guidance. Proprietary & Confidential 4

5 Guidance Practices and Trends Guidance Content 35% 3 25% 2 15% 1 5% Percent of Companies by Guidance Content 34% 25% 17% Revenue Guidance Profit Guidance EPS Guidance EventVestor 5 45% 35% 3 25% 2 15% 1 5% Percet of Companies Providing Quantitative Guidance Most companies provide directional and long term guidance and usually guide on operational metrics like CapEx and margins. 15% 6% 9% 43% Revenue Range Profit Range EPS Range Other Metrics About 15% of the companies provide quantitative revenue range guidance while another 19% of the companies provide directional or qualitative revenue guidance. EventVestor About 6% of the companies provide quantitative profit range guidance while another 19% of the companies provide directional or qualitative profit guidance. Among the companies that provide guidance, only about 17% of the companies provide EPS related guidance (9% of the companies provide quantitative EPS range guidance while the remaining 8% provide directional or qualitative EPS guidance. Proprietary & Confidential 5

6 EventVestor s Powerful Data and Analytics Help IR Professionals Gain Valuable, Timely Insight into Key Issues Driving Valuation & Trading Activity Executive Use of Product Index Change Capital Guidance Development Changes Capture investment community reaction to senior management and Board appointments and departures Qualitative attributes highlight rationale for executive changes from succession planning and restructuring-driven change to acrimonious board disputes Granular detail on stock buybacks, dividends and M&A activities Better synthesize how peers allocate capital Anticipate market reaction to changes in dividend policy or buyback activity Insight into key M&A milestones that will drive trading activity Detailed 5-year history of guidance trends covering 60K+ announcements by US, UK and Canadian companies Analyze specific peers, industries or cross-industry Discover trends and anticipate market reaction related to changes in guidance Track trading trends from product development to commercialization From new product launches to bio-pharma clinical trial milestones including regulatory approvals Gain insight into IP milestones that drive valuation Commercialization milestones include new customer wins and contracts Understand historical trading volume and price trends in advance of annual or periodic rebalancing of major equity indices For more details, please contact us at: IntelliBusiness, Inc. 100 Overlook Center, 2nd Floor Princeton, NJ Phone: anju@intellibusiness.com EventVestor IR Solutions Coverage: Web-based analytic platform covering 80+ event types and 4,000+ companies Custom event studies analyzing specific peers and industries Interactive charts for board-level presentations Event library as a reference tool for drafting event announcements Event-driven alerts