To help alleviate the stress of the holiday season and the mind-numbing speculation about the ways MiFID II will roil the IR waters in 2018, I’m holding off on my next dense, for only-the-most-dedicated IROs blog (which will highlight that the equity research that moves markets today is not the sell-side equity research targeted by MiFID II).
Instead, I’m gifting you my:
Top Ten Reasons IROs Should Enjoy This Holiday Season!
- If your company is well-covered, you’ll lose analysts and waste less time painstakingly walking them through spreadsheets and basic facts about your company.
- If you’re not well-covered, things can only get better from here and maybe, just maybe, Board members and a wide variety of “experts” (of the “IR is taking people to lunch” school of thought) will stop telling you “what you really need is to develop some sell-side coverage.”
- When analysts get something wrong and try to blame you, you can threaten to turn them in for violating any number of US securities laws. Under MiFID II they are getting paid at different rates to provide valuable (depending on how much the buy-side agrees to pay) actionable information - at different times - to a limited number of institutional clients. This is, of course, illegal in the US.
- When management tries to blame you for that same analyst getting something wrong, you can say you were protecting them from being too closely associated with someone who may be the subject of an SEC enforcement action (keep the "you know what a Wells Notice is, right?" up your sleeve.)
- You’ll enjoy free magic shows as corporate brokers disappear before your eyes, right in the middle of saying "Nothing will chan…"
- The free show will go on as those same brokers magically reappear as IROs at public companies, telling you at Investor Relations Society meetings how you have to watch out for those shape shifting investment bankers and corporate brokers.
- Sell-side corporate access will continue to target ever smaller groups of high-turnover investors so your 2018 travel schedule will only include London, New York and IRO tent cities set up by brokerage firms near the SALT, Sohn and GAIM conferences.
- Corporate access teams will give IROs and senior managements “Frequent Meeter” cards, with benefits that can be redeemed for prime appearance slots at any remaining industry conferences. Diamond Level Meeters can qualify for a one-on-one with a long-term value investor!
- With sell-side analysts joining stock tickers and trading tickets in the Museum of Finance, fund managers will stop proclaiming to you across the meeting table how they pay no attention to the sell-side (while printouts of sell-side research sit directly in front of them).
- Those same PMs will not ask “who does the best job of covering you on the sell-side?” at the end of the buy-side meetings that you are now organizing yourself, giving you time to ask them where you should send their bill for corporate access.
But my biggest gift of all to you is that you’ll read and hear less and less MiFID II speculation as 2018 progresses. The next “big thing” in IR and capital markets communications will no doubt emerge with the tulips in the spring. In the meantime, enjoy your holiday cheer confident in the knowledge nothing really changes for the IRO who’s committed to competing for capital. And 2018 will be the year that commitment creates more value than ever.
And for those of you too young to remember Hanukkah Harry, he first appeared on Saturday Night Live in 1989 in the skit “The Night Hanukkah Harry Saved Christmas.”
"You know, deep down, everyone is pretty much the same." - Santa Claus, while thanking Hanukkah Harry for saving Christmas.