Small cap stocks, for all the opportunity they may present, can be notorious when it comes to finding meaningful information about the underlying business. Shareholder meetings are a regulatory requirement for publicly traded companies for this very reason – to share information so investors can make intelligent decisions about their allocation of capital. This is one of the many topics slated for discussion at The Microcap Conference 2024, set for January 30-February 1 at Caesars Atlantic City Hotel and Casino. This three-day conference presented by DealFlow Events features an investment insights symposium designed for microcap investors and a presenting company track for pitching and socializing.
Here are some of the key ways in which investors can maximize the value of participating in microcap shareholder meetings. This process is ongoing and begins long before the meeting itself.
Communicate as necessary with the Investor Relations Department
Microcap firms need an investor relations department. Investors should be able to find out what’s going on with a company weeks or months before a shareholder meeting is scheduled. All publicly traded companies should have a primary point of contact for shareholders, analysts and the media.
Because of their size, small-cap companies may outsource IR services to lower their expenses. Whoever handles the job should have a deep understanding of the company’s business and financials – and be able to communicate transparently with all stakeholders.
Attend investor roadshows & conferences
These events are invaluable for connecting with company leaders and meeting other investors. Roadshows, especially, offer a personal touch that online interactions can’t duplicate. To make the most of these events, plan your participation, book appointments in advance whenever possible and arrive with questions.
Check the company’s social media accounts often
Social media can be an effective tool for building relationships with investors. Microcap companies should already have their business profiles on major platforms like Facebook, LinkedIn, Twitter and Reddit. Companies that post regular updates to these profiles with the latest news and developments demonstrate a commitment to investor engagement.
Stay on top of media and analyst coverage
If a microcap firm receives analyst coverage, that’s golden information to digest before the shareholder meeting. Companies that talk to stock advisory firms and make executives available for media interviews demonstrate transparency and a commitment to consistent public relations. That’s a good thing.
Thoroughly review the proxy and all investor presentations ahead of the shareholder meeting
It is said that you can find buckets of golf balls if you go poking around in the rough. Similarly, the information needed to make sage decisions about your investment can be found in the details of a proxy filing. Yes, proxies can be as dry as the Kalahari Desert, but the details to be discussed must still be in there. Knowing what’s at stake in advance of the meeting is critical to the return-rate success of any investment. And while some may dread the thought of enduring another slide show, investor presentations that provide a clear, concise overview of the company and financial performance are an invaluable tool that shows the company is on top of its line of business and dedicated to growth.
Participate in all shareholder meetings
Shareholder meetings offer investors the single best venue for asking questions and raising concerns, especially because your voice is heard by other shareholders who may be inclined to agree with you and vote accordingly on any matters presented at the meeting. Your comments and questions could be the catalyst that drives other shareholders to vote with you. The shareholders meeting is where dicey issues will always come up, from executive compensation and taking on new debt, to expansion plans that may be at odds with investors who envision a different route to success.
The shareholders meeting is also the opportunity for a company to demonstrate trust and credibility with its investors. Do ask questions directly to management. If a question is not answered to your satisfaction, follow up with additional questions. Your fellow investors will almost certainly thank you.
The late U.S. President George H. W. Bush is credited with the expression, “Ninety percent of life is just showing up.” Through the years the expression has evolved into, “Ninety percent of success is just showing up.” When investors avail themselves of all information before and during a shareholder meeting, showing up to participate may be the deciding factor in whether to continue with a particular stock investment.
Tickets to the inaugural Microcap Conference 2024 are going fast. Reserve your seat now for three days of unsurpassed networking and technical discussions of the microcap sector with some of the best names in the business – institutional investors, finance-focused law firms, , investor relations professionals, venture and private equity fund managers, deal advisors, PIPE funds, brokerage firms, accredited retail investors and many more. The conference schedule is also packed with entertainment and exciting activities set against the backdrop of Atlantic City’s bright lights.