Earnings call analysis
This might be bit of a naive question but I had been struggling with this and hope to find help from experienced professionals.
During earnings season, I had been struggling to keep pace with reading through all the earnings call transcripts. Reading one transcript takes around 30 minutes to 1 hour for me and then I had to read some old transcripts too to make sense of some trends or changes. So one company earnings take around 2-3 hours atleast for me and this is just data gathering. Then I use this data to put out some insights.
Is this process in terms of effort and time consumed common practice in the industry? I have heard that asset management firms generally have smaller teams and need to make faster decisions. If that is true, then how do these firms cope up during earnings season as earnings can be a important factor for making investment decisions. Or are there any tools which teams use not just to fetch data but to get insights also?
Curious to know more about asset management workflow for earnings call transcript analysis.
Bump - also curious about this.
Since I'm not in AM I've always been able to quickly scan through earnings at a more superficial level and oftentimes know what I'm looking for (i.e., can keyword search). It still takes some time... any approaches / secret sauce to be aware of?
You will get better with time / reps, particularly as you get to know a company over many quarters / years
Echo above - gets much easier when you learn the company really well and know exactly what matters and what is new information vs. old information. Much of the information is not helpful/doesn't impact the thesis and much of it is repetitive. Being able to know what matters allows you to filter through it much more quickly to make decisions. All takes time. It was overwhelming at first when I started in ER. Earnings season is always like drinking from a fire hose, but it gets less overwhelming.
There can be new trends coming which were not tracked earlier. Finding those can become important for an overall analysis. Also, comparing some topics with historical data would be important to understand the direction. When covering for 20 companies, this might become difficult and error prone too.
Earnings season can be a real time crunch, especially with all the reading and analysis. I've heard some teams use tools that help streamline the process, but it's always interesting to learn more about how different firms tackle this challenge.
Do you know about what these tools are?
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