Q – We’re in the process of boosting our institutional outreach and it’s proving quite a challenge to determine which institutions we should be meeting. Our budget is fairly limited but one of our main IR goals this year is to attract new institutions into the stock to offset some recent hedge fund activity. Any tips on ensuring we’re approaching the right fund managers?
A – Start by analyzing your existing base of institutional investors. There are several database tools available to help you with this, including those offered for free by Nasdaq or your specialist firm if you’re on the NYSE. You want to develop a profile of your existing institutional shareholders taking into account such characteristics as investment style – growth, momentum, value, and so on.
From this you should be able to ascertain the type of institutional investor most likely to be interested in your company.
Some institutional targeting tools will also enable you to analyze the holdings of peer companies, from which you can develop a list of suitable candidates – namely, those companies that hold two or more of your peers.
Q – Is there a definitive resource on IR web sites? We’re in the process of relaunching our site and I am looking for information on how investors and analysts navigate IR web sites and what type of data they’re searching for.
A – Many IR web site vendors publish guides on what should be (or can be) incorporated into a company’s site. Of course, you may have to listen to a polite sales pitch if you request such information, but very few things in life come without a price.
While this is a good place to start, you can also do some research on your own. Analyze the web sites of peer companies to see what they include. If certain commonalities exist, consider incorporating those elements into your site. Also, look beyond your industry and at companies that are most admired – basically those companies everybody talks about – because they may have interesting features that could be adapted for use by your firm.
But nothing should be designed in a vacuum. Talk with your institutional investors and find out whose sites they admire, and why. Also make sure you keep in mind retail investors, who often have different needs when it comes to IR web sites. From all of this, you should be able to design a functional site that will have great appeal.
One word of caution, though: technology is rapidly changing, so you should repeat the exercise described above regularly, at least on an annual basis, to ensure your site is evolving with investor needs and regulatory changes.
E-mail questions to [email protected].
Hulus Alpay is senior vice president of New York-based IR and PR firm Makovsky & Company.
