By Patti Bank
Over the last 25 years, I have listened to hundreds of earnings calls. As a sell-side analyst, they were a routine and not-much-fun part of the job. Four times a year, you lock yourself in your office and listen to call after call of management teams highlighting their achievements or trying to sugar coat the not-so-positive news.
Most of the calls were pretty standard, and came off as well thought-out and comprehensive. But every so often you would hear that call where the sell-side analysts were unforgiving in their questions and the tone was so negative you almost feel bad for the management team. In my role here at ICR Westwicke, I’ve learned what really goes on behind the scenes to make those effective earnings calls appear effortless: a lot of hard work and practice starting about a month ahead of time. Who would have ever thought?
Especially during times of volatile market conditions, we receive many calls from companies asking for our help. When a company’s stock is underwater, there is no magic bullet to getting a company’s stock price back up without execution. However, putting in the extra effort on the investor relations front does make a big difference. This includes prepping management teams for earnings calls. In a poor market environment, this may be one of your few opportunities to gain visibility with investors, so having a smooth call with no mistakes can go a long way.
At ICR Westwicke, we believe in over-preparing for the call. Below, find our proven process that begins five weeks ahead of the call date and incorporates not just drafting a script, but also strategizing over Q&A, peer intelligence, and prepping a concise and consistent message.
Five weeks prior to the call:
Set your calendar to include the following dates and deadlines:
Four weeks prior to the call:
Two to three weeks prior to the call:
One week prior to the call:
One to two days prior to the call:
While earnings calls seem like a tedious part of the job that just have to get done, there is definitely a right way and a wrong way to do them. The hour you spend on the phone directly impacts your stock. Use it to your advantage to make a favorable impression. For more tips, download our checklist, “8 Best Practices of an Effective Earnings Call.”