The broker view: European investment in US companies

Mar 29, 2018
This article was produced by ELITE Connect and originally published on the ELITE Connect platform

In the last in our series of articles focusing on how US companies can best connect with European investors, we hear from Andre Juillard, global head of SmartConnect services at Kepler Cheuvreux, who shares his experience and gives us his broker perspective.

How do you identify the right markets for the companies you are working with?

The first step is research to ensure we really know our clients and establish the key issues they are focusing on. This allows us to contact corporates and highlight to them how, and where, we can provide tangible added value.

For each corporate roadshow, we provide the company with a target list of investors. This is determined by working closely with our analysts and sales department, and by using database research to combine the company’s shareholders, its competitors’ shareholders and our knowledge of the market. When we’ve compiled this research, we discuss the list with the issuer to determine key factors such as the destination and the format.

How do you prepare research and advice for companies on getting the best out of this relationship when trying to expand their investor base to Europe?

Our research is fully independent so corporates need to accept analysts’ recommendations, whether they’re positive or negative. The advice we deliver to corporates is based on the knowledge we gather on the company as well as the market and investors’ expectations.

The very nature of changing circumstances and variable market factors means some sectors can be appealing to European investors at certain times, and the opposite during other periods. This requires our internal research to be as up to date as possible. 

Have you noticed any significant recent trends concerning European investment in US companies?

At the moment, investors are slightly more focused on European stocks. This is mostly because these are currently considered cheaper than US stocks. European shares are also expected to benefit from higher growth.

In your experience, what are the issues European investors are most interested in when it comes to investing in US companies?

Investors’ expectations are more or less always the same and mainly depend on the details of their investment model. Some investors are looking for growth, others for yield, others for value and some for hedging opportunities from discrepancies between stocks in the same sectors.

We also see a mix of investors in terms of capabilities – from those that are global and can invest in Asia, Europe or US, to others that are specialists, and can invest in one currency only.

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