Small cap Archive

Dec 03, 2020
What does the future hold for Mifid II's unbundling rules?
It didn’t take long for Europe to roll back some of the strict rules surrounding research payments contained in Mifid II. As part of a Covid-19 relief package, the European Commission (EC) has proposed an exemption to unbundling rules for research on companies of less than €1 bn ($1.2 bn) in market cap. The aim is to stimulate more research on smaller issuers, which have witnessed declining analyst coverage for a number of years. The tough unbundling rules conta...
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Nov 02, 2020
How to restore trust after a run of underperformance
As much as companies and their advisers would prefer that every quarter go in the books with numbers in line or ahead of expectations, that is not always the case. Reality is that business for most companies is dynamic, with quarterly financials fluctuating for any number of reasons. When a company misses management projections or external estimates but quickly returns to regularly reporting results in line with expectations, that off quarter will often be considered a ‘...
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Oct 27, 2020
‘Each of them brought something different’: The value of working with non-covering analysts
There are a number of benefits to be gained from marketing with non-covering analysts, even if you don’t expect them to end up following your company, according to panelists at the IR Magazine Forum – Small Cap.  At the virtual event, one session focused on how to boost analyst numbers now, when factors such as Mifid II, economic pressure on the sell side and Covid-19 are making it hard to attract new followers.  But the discussion also explored the val...
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Oct 21, 2020
‘Some smaller companies more resilient,’ fund manager says
The Covid-19 pandemic has been a catalyst for some of the developing challenges faced by small and micro-cap companies, including targeting sell-side coverage, visibility to institutional investors and a need to tell a purpose-led corporate story that considers material ESG factors while on a limited budget. At the early stage of the Covid-19 outbreak in the US, investors flocked to safe bets like mega-cap technology stocks, recognizing an opportunity to increase t...
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Oct 12, 2020
Recent trends in retail investing: What does it mean for issuers?
This year has been an unprecedented one in a myriad ways, not least the volatility and performance of the US stock market. In March 2020 the Dow Jones Industrial Average saw one of its fastest declines on record and the Chicago Board Options Exchange’s Volatility Index, which measures the stock market’s expectation of volatility, hit an all-time high. Even more remarkable was the subsequent market rebound, which over the span of five months saw the stock market retrace...
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Sep 24, 2020
Traditionally the reserve of larger firms, ESG ratings for small & mid-caps are vital – and now accessible
ESG scrutiny from fund managers and retail investors has risen exponentially over the past few years, a trend only accelerated by the Covid-19 crisis. Furthermore, an inter-generational wealth transfer is underway. Over the next 30 years, £5.5 tn ($7 tn) in assets will shift from baby boomers to the millennial and Gen Z demographics who are increasingly calling for companies to demonstrate the positive impact they have on wider society.   In 2019 this was visibly ...
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Sep 21, 2020
UK regulator gives green light to medical cannabis listings
The UK’s financial regulator has said medical cannabis companies based in the UK will be cleared to list on the London Stock Exchange (LSE), although the situation is more complicated for overseas firms and suppliers of recreational cannabis remain banned.  The Financial Conduct Authority (FCA) says the legal situation for medical cannabis and cannabis-oil companies located in the UK is ‘clear’: they can be admitted for trading as long as they have the approp...
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