Earnings Call Analyses Reveals Hidden Market Intelligence

Capturing online conversations, articles and the calls themselves in one place reveals key earning call intel that analysts may otherwise miss. In this piece, we’ll explore powerful earning call visualizations that every enterprise will want to add to their “must have” list for Santa.

More specifically, we’ll share:

And here are some interesting earning call facts:

  • Companies that want to play down poor performance in their earnings reports seek to release their calls when less people are paying attention; cloak undesirable results through use of euphemisms; and, seek to draw attention away from negative results by italicizing or boldening headlines meant to redirect attention.
  • Since the promulgation of the “fair disclosure” regulation by the Securities and Exchange Commission in 2000, earnings calls are to be made available to all investors; transcripts of which are typically available online.
  • Linguistic features of these calls can be analyzed to uncover hidden indicators when the right market intelligence tool is deployed.

Let’s see how that looks!

guide to media and market intelligence

Earnings Call Analysis Insight Overview

Market research explores every option in the quest for competitive intelligence to ensure your brand has every bit of intel at its disposal to minimize risk and maximize brand potential. If your brand isn’t using earnings calls analyses to that end, you’re missing out on some meaty observations – including performance on emerging trends.

As one of the many “lenses” you should be looking at when it comes to competitive intelligence, the earnings transcript dataset nicely augments the insights you can glean from news, blogs, social media, investments and patents, which are all accessible via NetBase Quid. Monitoring your competition through multiple lenses provides a more holistic understanding of their strategy and allows you to gain an edge.

Since earnings reports are public there’s no reason that brands shouldn’t be using them to gather as much insight as possible into the inner workings of the competition. Most brands have an investor section on their websites with either the audio file, transcript or both. And there are always other places online to find them as well, such as this earnings calendar showing upcoming calls. It’s also got email alerts so you’re sure not to miss a thing.

What’s exciting for brands is the ability to convert these .pdf transcripts into a .csv file and upload them into Quid Pro, allowing you to slice and dice the data as you would your news and blogs dataset, or social media listening analysis in Quid Social. To see what that looks like, below are 18 full earnings call transcripts from six brands in the cannabis industry primed and ready for a deep dive.

cluster-map-of-earnings-call-analyses

Analysts, researchers and investors, of course, pour over these earnings calls looking for verbal patterns and cues; reading between the lines to inform their decisions – and you should too. Since the Quid product can turn your earnings call transcripts into visualized data, there’s no reason not to mine these resources for valuable intel.

It really puts a new perspective into boring earnings calls doesn’t it? Let’s dive in a little deeper.

Hidden Market Intelligence that Earnings Calls Offer

The language used in earnings calls can shine light on how leadership feels about the information that they are sharing. For example, whether or not a CEO defers questions to the CFO or other executives when asked can indicate a lack of familiarity on the subject at hand. That tells a story in itself.

Research is growing in the realm of earnings calls – and it’s dedicated to deciphering nuances that better tell the story. Pulling these transcripts together for evaluation can reveal insights that inform your market intelligence and put your brand a step ahead.

For example, the use of euphemisms takes the edge off of information that a firm may want to gloss over quickly. For the unobservant it might be missed, but brands looking for them will understand that they are characterized by never giving concrete details.

common-phrases-to-listen-for-in-earnings-calls-analyses

If a CEO is constantly using the word “headwind” or “flattish” you’ll notice that they aren’t exactly saying that sales are down 8% over last quarter. They’re glossing over concrete details they’re not super excited about. What’s really great here and can inform your market intelligence is the fact that you can pull in all of the transcripts you want and track any keyword or phrase to help track language versus performance.

The ability to dig down into the data to a granular level is the real game changer here. No matter what you’re looking for, you can dial it in and find the insights that are important to you. Here for example, from our above analysis we filtered down just for mentions of the word “costs” exclusive to the CFO of one of the six companies, Grow Generation Corp. (GRWG) of which we had three quarters worth of transcripts.

isolating-cost-converation-in-earnings-call

As you can see, the scatterplot is also set to display date versus character count and indicates here that the CFO was speaking more at length and generally more negatively about costs back in March as opposed to the most recent call in August. Each of the nodes is clickable, which returns the exact text referenced from the calls giving further context to the visualized data.

And since comparison is super helpful in any aspect of market research, here’s the same data returned on “costs” by the CFO of Trulieve Cannabis Corp. (TCNNF), of which we had two transcripts.

isolating-cost-converation-in-earnings-call-2

Positive sentiment here is very high comparatively at 76% versus only 28% positivity in the previous example. As you can see here, language is telling and the ability to slice the data any which way you want will help your brand uncover hidden insights within these earnings calls that just isn’t available from simply reading them. They are truly a goldmine of data waiting to be explored. This CEO feels more positive about earnings – does that mean you should too?

guide to media and market intelligence

How Earnings Call Transcripts Reveal Competitive Intelligence

Q4 earnings season has passed, but if you didn’t get the low-down on the competition, then there’s no time like the present to jump into the earnings calls transcripts and extract the most recent competitive intelligence. And it’ll set you up well for comparison analysis when Q1 rolls around.

And from a competitive intelligence perspective, the tumultuous effects of the coronavirus have underscored the importance of grabbing up any intel available in the rush to remain competitive. If you’re involved in the cannabis industry this couldn’t be truer.

2019 saw a general downturn for the industry due in part to oversaturation and the fact that the product remains illegal on a federal level. In other words, the easing of restrictions both federally and on a state level did not move enough to help balance a bloated market. The onset of the pandemic earlier this year contributed further to exacerbate investor frustrations.

stock-prices

 

If you pretend for a moment that this is your industry, then you’d want to hang on every word coming out of competitor’s earnings calls to not only take their temperature – but to take yours as well.

To get to that end in the cannabis industry, here are the six companies in our analysis:

And here they are on a bar chart returned by ticker symbol and colored by sentiment. They are also highlighted by mentions of the word “inventory”.

comparison-of-six-companies

Say for example, your brand is not moving inventory as much as you’d like in an industry fighting out of a downturn, then seeing how the board members of the competition are discussing their inventory could yield insights to help you make changes. If they’re implementing a strategy that’s working and you’ve yet to embrace it, then it’s insight like this that helps inform your move in the right direction.

And of course, this is just one example out of endless possibilities. No matter what insight you uncover, all of it is searchable which allows you to see the information in context as well as additional insights into the speaker, role, company, etc.

Aurora-CFO-conversation-analysis-from-earnings-call

Really, the sky is the limit in unearthing insights from earnings call transcripts and is a great addition to your market research arsenal. What better way to get financial insights than straight from the horse’s mouth? At any rate, companies uncover data from M&A intel, patents, news sources and social media everyday so there’s no reason not to add earnings calls to your competitive intelligence mix.

If your brand isn’t already exploring earnings call datasets, are you ready to up your game? It’s a whole new world of insight, free for the taking to help inform your brand. Put the power of next generation artificial intelligence (AI) to work for your financial datasets and shed new light into your market. Be sure to reach out for a demo and we’ll get you dialed in to the latest earnings calls so you don’t miss a thing!

guide to media and market intelligence

NetBase Product Line

Premier social media analytics platform

Tailored platform for growing businesses

Expand your social platform with LexisNexis news media

Power of social analytics for your entire team

Customer experience analytics platform

AI, Image Analytics, Reporting Tools, APIs & more

Product configurations to meet all needs

Quid Product Line

Media analytics and market intelligence platform

Enrich your media analytics with social data

Media coverage for historical & real-time monitoring

AI algorithms, NLP, data sources, and visualization

Tailored, configurable solutions