A compelling investor day can be one of the most impactful ways for a company to articulate its growth strategy and provide clear, credible long-term financial targets that resonate with the investment community. On the other hand, a poorly timed or poorly executed event can invite increased management scrutiny, and in some cases, even spark shareholder activism. Given the significant amount of time, effort and resources required to pull off a successful investor day, it’s critical to thoughtfully consider the event’s timing and strategic rationale.

At IR Magazine’s recent IR Think Tank in San Francisco, Edelman Smithfield participated in a discussion with Dave Zbojniewicz, vice president of investor relations at Mattel, and Brooke Bakewell, senior manager of investor relations at Salesforce, about how to execute a well-timed, meaningful investor day. We suggest that investor relations teams and other members of leadership consider the following questions before planning such an important event that could have lasting consequences for the company.  

  1. Do you have a strategic update to provide? A detailed strategic update is the backbone of any successful investor day. Yet, for most companies we partner with, corporate strategies don’t tend to evolve significantly enough each year to justify an annual event. Investor days are a significant time commitment for IR and the management team, as well as for investors and analysts. No one wants to hear a re-hash of your last earnings call.  More breathing room between events, typically two or three years, allows companies to provide a more comprehensive and compelling strategic update. That said, every company and industry is different. For a toymaker, an annual event provides the opportunity to update investors on the new product roadmap for the year ahead. A bank, on the other hand, may not need an investor day every year.
  2. Are you prepared to update your mid- to- long-term financial targets? When considering an investor day, one of the first questions we ask our clients is if they are prepared to share mid- to- long-range financial targets, along with a detailed framework for how they intend to achieve those targets. We hear from investors and analysts alike that an update to the company’s growth plan is table stakes for these types of events, and they often walk away disappointed if a company is unable to provide a credible roadmap for achieving these strategic goals. If you aren’t ready to talk about your financial targets, it’s often best to hold off on an investor day and instead focus on execution.  
  3. Are you ready to provide access to the management bench beyond the CEO and CFO? While investors and analysts have several touch points with the CEO and CFO throughout the year, including earnings, sell-side conferences, and one-on-one investor meetings, the Street rarely has an opportunity to interact with other members of the management team. Investor days present a unique opportunity to provide a deeper dive into your company’s segments, digital and marketing strategies, supply chain and operations, and other relevant topics. Give the head of Southeast operations a few minutes to discuss opportunities in the region. Have the chief technology officer discuss her role, and how digital transformation is shaping the future of your business. Access to a wide range of leaders gives investors and analysts confidence that the right team is in place. 
  4. What’s the industry backdrop? You’re ready to articulate a compelling long-term strategy, provide financial targets, and have a deep bench of leaders prepared to deliver your message. But what if the macroeconomic picture isn’t as clear? While you shouldn’t try to “time the market,” it is important to monitor the broader industry backdrop so you aren’t caught off guard by tough questions. After all, your company doesn’t operate in a vacuum. Be alert for changes in market conditions that could make an investor day less compelling. For this reason, it’s important to give yourself flexibility when announcing an investor day. While you can start the planning process well in advance, in most cases companies should wait to announce the event until they are certain that they’re ready to move forward, typically one to two months before the event.

While we have found it is often appropriate to hold an investor day every two or three years, every company should evaluate its own unique circumstances individually. To that end, there are several key milestones that would make an investor day worth considering outside of the typical cadence:

  1. A recent CEO transition. New leadership typically brings refreshed strategic thinking, and an investor day gives the new CEO a venue to provide a more detailed overview of his or her strategic vision. Based on our benchmarking, most companies host an investor day in the first 12-18 months following the appointment of a new CEO.
  2. A transformative acquisition. There are several strategic implications when engaging in a large, transformative acquisition, including the impact of the transaction on the go-forward business mix, changes in growth strategy, and near- and long-term financial implications. A refreshed view of the combined company may be valuable when strategy and integration work is well underway.
  3.  A spin-off or divestiture. A spin-off or divestiture presents a significant opportunity to reset the investment thesis and strategy for the remaining company and the one that is spun off. For the new entity in particular, an investor day is the first opportunity to present the company’s strategic direction as a standalone company, introduce the management team, and set the course for the future.

As impactful as an investor day can be, sometimes it just isn’t the right time or place. Maybe the strategy is being revamped and management isn’t yet ready to unveil it publicly. Maybe the growth framework hasn’t changed materially enough to justify another detailed update, and the resulting event would be viewed as a disappointment. Or maybe the macroeconomic environment is uncertain, rendering it difficult to produce credible financial targets.

An investor day is a valuable event for leadership, investors, and analysts. Use it wisely.

Hunter Stenback, Executive Vice President, Strategic Situations & Investor Relations (hunter.stenback@edelmansmithfield.com


Edelman Smithfield’s Hunter Stenback (far right) discusses investor day best practices as part of a panel at IR Magazine’s IR Think Tank in San Fransisco on September 26, 2023