With assets in actively managed investment funds shrinking in favor of index funds and ETFs, it’s tougher than ever to get the attention of active money managers. How are companies differentiating themselves as they compete for capital? Our panel of investors will discuss the attributes and practices of companies that get their attention -– positively or otherwise. You’ll learn about best-in-class examples and mistakes companies make in their approach to owners and prospective buyers.
4:30 – 5 p.m. Registration & Networking
5:00 – 6:00 p.m. Program
6:00 – 7:00 p.m. Networking Reception
The Metropolitan, Willis Tower
233 S. Wacker Drive, 66th Floor
Chicago, IL 60606
Panelists
Erika Maschmeyer, CFA
Senior Equity Analyst, Columbia Threadneedle
Erika Maschmeyer joined Columbia Threadneedle in 2016 after holding analyst positions with Oak Ridge Investments and Robert W. Baird. She holds an MBA from the University of Chicago Booth School of Business and a bachelor’s degree from Denison University.
Glenn Primack
Senior Analyst, Endeavor Commodity Fund
Glenn Primack joined Endeavor in 2015 after serving as an analyst with Achievement Asset Management, Peak6 Investments and as a founder of Broadview Advisors. He holds an MBA from the University of Chicago Booth School of Business and a bachelor’s degree from Colorado College.
John Souter
Portfolio Manager, RMB Capital
John Souter is a portfolio manager at RMB Capital and for the past 15 years has been managing the healthcare portfolio for the Rail-Splitter Funds. Previously he worked on the sell-side for eight years as a senior research analyst with SG Cowen and William Blair & Co. He holds an MBA from Kellogg School of Management at Northwestern University and a bachelor’s degree from the University of Notre Dame.
Moderator
Leslie H. Kratcoski, IRC
Vice President of Investor Relations, Snap-on Incorporated
Leslie Kratcoski leads IR at Snap-on Incorporated, a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks. Her 17 years of investor relations experience include positions with Beazer Homes USA Inc. and PRG-Schultz International, Inc. Kratcoski earned a bachelor’s degree and MBA from the University of Florida and an international MBA from Nyenrode University, The Netherlands Business School.
Investor Relations Charter (IRC) Areas of Competency:
Domain 1: IR Strategy Formulation
Domain 3: Corporate Messaging Development
Domain 4: Investor Marketing and Outreach
KEY TAKEAWAYS:
- While our panelists work for different firms and focus on varying industries, they expressed similar views on what they want from investor relations officers. “The IRO needs to know the numbers the way a CEO knows them and articulate the strategy, pressure points, risks and competitive advantages,” said John Souter of RMB. “As an integral part of the management team, IROs should be able to tell you what the CEO or CFO would say if they were in your meeting – but with insight on how to translate that information to investors,” added Erika Maschmeyer of Columbia Threadneedle. “You also need to build trust and rapport as the conduit between investors and management,” concluded Glenn Primack of Endeavor.
- Companies that are successful in competing for capital can gain positive attention from investors and differentiate themselves from their peers in the quality of their interactions with investors. For example, one company’s IRO solicits questions from the buy-side before each earnings call to make sure key concerns are addressed even if the sell-side doesn’t ask about them. The best investor presentations clearly explain the business model, competitive advantages and return metrics. Maschmeyer praised company headquarters visits where she can meet more members of the management team, “not just the CEO.”
- Both management behavior and non-company sources can raise red flags in the minds of investors – such as management teams that are overly defensive or try to spin bad news. (Maschmeyer’s example: “On an earnings call, saying ‘our results were exceptional’ after the stock drops 15%.”) Primack finds value in mispriced assets and uncovers both investment ideas and concerns at trade shows and online; he cited Glassdoor as a window on a company’s culture, which may prompt high employee turnover. Souter’s concerns include inappropriate use of non-GAAP numbers: “It’s almost criminal what gets stuffed into, or excluded from, non-GAAP numbers – and it’s not fooling anyone.”
- Souter uses the sell-side for background on new names and earnings models “so I don’t have to start from scratch,” but he doesn’t pay attention to their buy or sell recommendations, especially given the trend toward younger/less experienced sell-side analysts. Maschmeyer talks to the sell-side for their perspective on company news, especially if it moves the stock on a given day. Primack may ask the sell-side for insights on why a company is an outlier but doesn’t rely on them to set up meetings. None of the panelists expect MiFID II to change how they use the sell-side.