Q4'23 Inside The Buy-Side® Earnings Primer®

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The Big So What™

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Long-term Financial Targets

When thoughtfully utilized, long-term targets influence key decisions and help shape the trajectory for growth and stability at a company. These targets are not just numbers; they represent a commitment to shareholders, a roadmap to fulfilling the company’s vision, and a benchmark against which The Street can measure progress. They also serve as an internal motivator.

To better understand long-term financial target trends, we analyzed 100 investor days that have occurred in 2023 across market caps and sectors.

Key Findings:

  • The majority, 82%, of companies that hosted investor days provided long-term financial targets
  • At least 80% of companies across all market cap ranges provided long-term financial targets with small caps the highest at 86%
  • Three-year (2025) and four-year (2026) are the most prevalent timeframes, at 20% and 26% respectively
  • Most companies provided three long-term financial metrics
  • Revenue growth (78%) and operating margins (73%) are the most oft-cited metrics provided, followed by EPS growth (34%), FCF (33%)

Selected Best Practices…

  • Introduce targets in a public forum that allows for management voiceover
  • Do not over commit by providing too many metrics or ones that are hard to predict
  • Provide achievable financial goals and communicate ranges where appropriate
  • Outline baseline assumptions and scenario analyses
  • In the absence of long-term targets, articulate strategy milestones

Corbin Advisors is a strategic consultancy accelerating value realization globally. We engage deeply with our clients to assess, architect, activate, and accelerate value realization, delivering research-based insights and execution excellence through a cultivated and caring team of experts with deep sector and situational experience, a best practice approach, and an outperformance mindset.

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