AS THE US first quarter earnings season officially got underway with yesterday’s results from Dow component Alcoa Inc., IR departments were preparing to monitor their peers’ results and release their own numbers.
Knowing what competitors are saying and getting a feel for the types of questions analysts are asking can help companies prepare for their earnings conference calls and ensure that their releases proactively address investor concerns.
Of course, unless companies have access to expensive research tools and services, keeping abreast of developments can be time consuming and challenging.
Seeking Alpha transcript database gets improved search
Fortunately, some help is at hand for companies with few resources and small budgets. Thanks to Web 2.0′s penchant for FREE!, new tools are now available that can help IR departments do their jobs better at little or no cost.
Take the free conference call transcript service from Seeking Alpha, an investment opinion and information website and distributor. The company transcribes the earnings calls of about 3,000 companies each quarter and posts these on its website where anyone can access them free. They are also available on Yahoo! Finance and to E*Trade customers.
According to a blog post by CEO David Jackson, Seeking Alpha recently improved its transcript database by adding a Google-powered search. If you want to know what other companies are saying or analysts are asking about a particular topic, you can now easily search the transcript database for companies that are mentioning it.
For instance, if you’re with a mining company and you want to know what other companies are saying right now on their conference calls about bauxite, simply type bauxite “q1 2008″ in the search field, refine the results to just transcripts, and you will get a list of transcripts mentioning the word.
Once you choose a transcript, you can then search it for your keyword and all mentions of it will be highlighted on the page. Here’s an example from Alcoa’s earnings call transcript last night with the word “bauxite” highlighted.
|After searching the entire database, you can narrow the search to a single event transcript. Here the search term is highlighted in the text to make it easier to see.|
Compare two transcripts in a tag cloud
For even more analysis, there’s another handy tool that has just been released by the Many Eyes data visualization service created by IBM. This free service lets anyone upload data and view and share that data in a range of different ways.
The latest visualization tool, released just last week, is called a comparison cloud. It is an expansion of the basic tag cloud concept. In case you’re not familiar with them, a tag cloud shows you how often words appear in a text. The size of the word in the tag cloud is based on the number of times it is used in the text.
This kind of visualization is a great way to quickly analyze vast amounts of free form text. And with the new comparison cloud, you can now see relationships between two sets of text.
I’ve been using it to see the prominence of key words in companies’ earnings call prepared remarks from one period to the next. Embedded below is a comparison cloud of Alcoa’s presentations in January and yesterday. The thing that jumped out at me is management’s much heavier use of the word “growth” in this quarter compared to last, which probably has something to do with the company missing estimates this quarter. ;-)
As new technologies like feeds and semantic data like XBRL become more prevalent, we humble humans are going to need better tools to analyze and visualize large amounts of data. Tools like Seeking Alpha’s searchable earnings call transcript database and IBM’s Many Eyes visualization initiative are just the beginning.