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Edleman Report

Earlier this year, Edelman Financial Communications & Investor Relations released the results of its Qualitative Information Survey a  proprietary survey completed by 158 portfolio managers and buy-side analysts in the United States.

Qualitative data is information that can’t actually be measured such as a company’s strategy, initiatives, milestones as well as additional commentary provided around topics like trends and guidance. In other words, the story.

While the answers were no surprise to us, it was awesome to see much of what we preach validated in the report.

Link to the complete survey and report.

Here are Investor Testing’s Key Takeaways:

  • “Investing is often thought of as purely a numbers game. But new research of buy-side analysts and portfolio managers reveals that investors look to qualitative information to deepen their investment thesis and refine their valuation model.”
  • 85% of respondents said qualitative information helps them during the evaluation and decision making process.
  • Growth-oriented investors place a higher value on what they hear from management than do value-centric and hedge investors.
  • 74% of growth investors consider management’s vision to be especially important; specifically the CEO’s
  • What investors seek most from management is a well crafted investment story. (more so than quantitative guidance)

Great report, there was lots more juicy information but we couldn’t very well put it all here, so be sure to check it out.

Conclusion

While numbers are important, they are not everything.

To quote an investor from the survey “If you’re prepared to invest in a company, you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won’t get bored.”

Or as we like to say here at Investor Testing: be sure you tell investors a simple, clear and compelling story.

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Mark McKelvie

Founder, CEO Investor Testing. If you want to find out how clear and compelling investors find your story ask them to explain it to you in their own words and watch what happens.

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