Listen in on Investor Conference Calls

Physician's Money Digest, August31 2004, Volume 11, Issue 16

Thanks to Regulation Fair Disclosure,individual physician-investors cannow be privy to corporate meetingsthat previously only included analystsand institutional investors.

Get the Chance to Listen

American Associationof Individual Investors Journal

According to the (www.aaii.com), almost all conference calls withmanagement at public companies arenow available to individual investors.Unfiltered information, such as guidanceon future earnings and insights on importantevents like new product launchesand corporate transactions, can now beyours just by listening in.

For doctors looking to learn moreabout the companies they've invested in,conference calls can be an invaluableresource. They're generally held after anews release has been issued announcingcompany earnings or reporting an acquisition.Management remarks are followedby a question and answer session, so valuableinformation can be obtained that isoften not contained in the news release.

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The article points out that thereare several ways to access these companyconference calls. The first is through a liveWebcast done over the Internet. You canalso obtain the conference call dial-ininformation and participate in the calldirectly. Some companies keep individualinvestors in a listen-only mode, but morerecently others have begun making interactiveparticipation available to everyone.Many companies keep calls archived andavailable either on their Web site or viatelephone for several days after the conferencecall takes place.

How can you know when a conferencecall is scheduled? Visit the company's Website or call their investor relations department.In addition, there are Web sitedirectories that provide information onhundreds of conference calls, such aswww.bestcalls.com or www.vcall.com.Either way, you'll need at least a 28.8 kilobytes-per-second Internet connection,and either RealPlayer or Windows MediaPlayer software to listen in.

Seize the Opportunity

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What should you be listening for duringa conference call? First, do your homework.The article suggests that youread recent press releases to prepare youfor the issues management is likely to discuss.Also, make a list of the issues you'dlike to have addressed.

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What management doesn't say is oftenjust as important as what they do say.Also, hard facts and figures are alwayspreferable to unspecific answers. As the article notes, you'd rather hear thecompany's chief financial officer say, "Ourbacklog is $12 million, up from $10 millionat the end of the previous quarter," thansomething vague like, "Our sales peopletell us that orders are looking good."

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The article suggests that you letthe analysts ask their questions first, sincethey might be similar to yours. If yourquestions don't get answered, considerhow to pose them to gain the informationyou seek. For example, open-endedquestions generally get better answers.Ask, "What concrete measures are youtaking to reduce costs?" as opposed to,"So you think you can reduce costs?" Themore specific you can be, the more likelyyour question will be answered to yoursatisfaction.