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Nov 16, 2023

IR has its work cut out as analyst coverage keeps falling

Webinar participants discuss best way to maintain engagement in current environment

It’s not a new trend but it’s as relevant as ever. The number of sell-side analysts covering companies is continuing to fall, according to new research, putting pressure on IROs to maintain existing relationships and find effective ways to work with an ever-more stretched analyst community.

On an IR Magazine Webinar this week, held in partnership with Visible Alpha, we released some preliminary findings from the Global Investor Relations Practice Report, which is based on a survey of several hundred IR professionals around the world.

Looking at the stats for North America in particular, the average number of analysts per company has dropped to 10.3 in 2023, down from 11.1 last year and a fall from 13 in pre-pandemic days. A poll of the webinar audience told a similar story, with most respondents saying coverage had either declined or stayed the same over the last 12 months.

Of course, these stats vary widely from company to company and industry to industry. Our webinar panel was a case in point: one speaker had seen coverage shrink, with analysts leaving to join the buy side or IR. But another, while experiencing contraction at some individual firms, had net-added analysts over the last year.

It all adds up to a challenging environment, however, for both IROs and the sell-side analysts they work with.

‘On our end, we feel like we are being asked to do more with less resources, and the wallet share available to equity research as a whole is shrinking, so there’s pressure from us to make sure we’re putting our efforts into places we can monetize,’ said Andrew Cooper, vice president of healthcare equity research at Raymond James.

Peggy Reilly Tharp, vice president of global IR at ICL Group, the specialty minerals company, emphasized the need to make the job of analysts as easy as possible, especially for complex businesses like hers that don’t fit into neat categories. ‘I don’t want people to say, You guys are complicated, we’ll skip you,’ she said.

Giuseppe Montefinese, manager, contributor relations for the US at Visible Alpha, agreed that resources are under pressure on the sell side but said that investors still see significant value in paying for the ‘right research’.

He noted that companies should consider whether additional coverage will truly add value: ‘The question I usually ask myself is: what number of brokers is the right number? And is adding more always a net positive?’

Panelists also discussed the vital importance of corporate access to keep analysts engaged and how virtual tools help spread the wealth among followers.

Executive access is now a lot more efficient, said Jason Schmidt, vice president of IR at Upstart, an artificial intelligence-powered lending platform. ‘We do a lot of Zoom meetings and virtual non-deal roadshows,’ he said. ‘We get on the road, too, but I think getting investors and the sell side in front of executives is a lot easier if you only need half an hour or 45 minutes of their time, spliced into an otherwise normal day.’

Has your analyst coverage changed? And what are some ways you find effective to maintain engagement in the current environment? We’d love to hear your thoughts. Please do get in touch at or via LinkedIn.