Rivel Releases Unprecedented International Study on Guidance Showing Deep Concern over Consensus Earnings and Short-term Volatility
April 6, 2017 | posted in Press Releases
Public Management Teams Fear Clout Wielded by Data Aggregators; Board Has More Influence on Guidance in Europe vs. North America; Majority of IROs Have Strong Influence on Setting Guidance
NEW YORK, April 6, 2017 /PRNewswire/ — Rivel Research Group, a global leader in investor market research and analytics, today revealed key findings from the largest global study of its kind on guidance. Between February and March 2017, Rivel conducted the guidance study among 976 North American and European companies, encompassing all market caps from small to mega cap.
A major finding is that when it comes to consensus data established by data aggregators, fully 76% of management teams in North America (and even 53% in Europe) are “somewhat” to “very concerned” about meeting quarterly consensus earnings and revenues established by data aggregators. Management teams are equally concerned about the short-term volatility that can occur when results do not align with consensus.
The study also found that Investor Relations Officers (IROs) have clout in this domain. The great majority in North America and Europe has modest to substantial influence on guidance-setting practices. The board has significantly more influence on guidance in Europe vs. North America; 82% have substantial to modest influence in Europe whereas only 46% have substantial to modest influence in North America.
“We are extremely pleased and proud to contribute greater insight to the understanding and practice of guidance around the world,” said Brian Rivel, President of Rivel Research Group. “Given the engagement of such a large number of management teams at global public companies who contributed to this study, these are the most representative and reliable guidance data yet published. While we know that meeting consensus is important, the study results really demonstrate the necessity of managing expectations directly with your shareholder base, managing all sell-side expectations and making sure that sell-side/data aggregator projections are correct and in-line with the company’s guidance.”
For more information on the study, please contact Sean McCurdy at firstname.lastname@example.org or (203) 493-2333.