An investor day is an event organized by companies in order to showcase the financial and operational performance of the business. Companies commonly use it to promote their stock to investors or potential investors, and analysts.
It usually involves a presentation, where the company shows data about their business and how it is doing. It also includes projections or estimates in terms of the future growth of the business.
An investor day can also be referred to as an investor event, or analyst event.
What is the purpose of investor days?
An investor day is used by the company and its management to show investors, potential investors, and analysts how the company is doing. It includes a presentation with operational and financial data. Although investor days have been conducted mostly in person, since the outbreak of COVID-19, it has been more common to hold investor events that are fully virtual, by using platforms such as Zoom.
What happens on investor days?
During investor days, the company and its management, namely the CEO and CFO will provide a detailed presentation on how the company is operating. This includes showing several KPIs, along with financial information. It will also include internal projections of the expected growth.
Following the presentation, analysts, investors, and potential investors are welcome to ask questions. This allows them to understand the business model better, and to make their own projections as to the company's growth.
During the discussion, the management will go over several topics like:
- Business model
- Growth strategy
- Investments the company is making
- Product or service line
- Risks and challenges
Why do companies hold investor days?
Companies hold analyst or investor days because it easily allows them to showcase the company, and answer direct questions investors or analysts might have. It is a way to promote their company as a reliable investment vehicle, by explaining the business value proposition better. An investor event allows the company to:
- Explain in more detail its business model
- Describe its growth opportunities
- Show its internal estimates for growth
- Showcase the management's ability
- Explain in detail the company’s strategy to grow
- It shows that management is concerned about shareholders
Additionally, it also gives more credibility to the company and its management team, as well as increases corporate transparency. It is also an important event for shareholders or potential shareholders to see if the company’s management is aligned with them.
An investor day is an important event for companies because it can promote their business to shareholders and analysts. It is an important way to attract investment and to even promote the business as a viable investment opportunity. Additionally, it allows the management to clarify certain questions that investors or analysts might have, which is crucial to increasing its credibility and transparency.