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

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CEO Perspective for 2024

Hello, Happy Friday, and Happy New Year! Welcome 2024 – what is sure to be another dynamic year packed with opportunities, challenges, and surprises.

Key trends in place or emerging that we believe will shape 2024 include:

1) Geopolitical Considerations Will Remain In Focus for Investors and Companies as We Enter a U.S. Presidential Election Year

  • China exposure — according to our latest survey, more investors are in outright favor of U.S. companies de-risking China exposure than those who believe executives should follow through on their “In China for China” strategy; companies should be prepared to defend positioning and educate the Street on the benefits and risk mitigation actions being taken
  • War in the Middle East — an evolving situation that requires candor and proactivity; expect shipping and transportation to become more expensive and delayed (i.e., watch for inflationary supply chain impacts) until this situation is resolved, and for investors to be acutely focused on contingency planning for those companies with exposure in the Middle East during upcoming discussions
  • Election year turbulence — election cycles have historically been periods of heightened market sensitivity, and our recent survey finds 69% of institutional investors have factored in the upcoming U.S. Presidential election in their investment strategies. Industries such as Tech, Energy, Industrials, and Healthcare, which typically are in the crosshairs of policy debates, are in focus

2) Artificial Intelligence: From Tinkering to Tactical, 2024 Could be the Year Where the Rubber Meets the Road

  • AI positioning statement — an effective way to anchor investors beyond the buzz words and to set the record straight; upon analyzing company communications across sectors and market caps, we’ve identified seven core elements of leading AI positioning statements:
    • Industry Impacts
    • Investment
    • Competitive Positioning
    • Customer Impact
    • Talent and Culture
    • Operational Efficiency
    • The AI “North Star”

3) Activism is Poised to Accelerate as the Deal Environment Improves

While last year’s activist activity culminated in a 40% uptick since 2018, we’re seeing a notable increase in activist activity in recent weeks, just as the capital markets have improved and deal activity has sprouted green shoots. Some best practices for corporates to be their own activist:

  • Remain on top of valuation — absolute and relative, specifically historical, industry, and proxy peer benchmark performances
  • Perform formal, periodic strategic reviews — supported by independent advisor input
  • Conduct proactive shareholder engagement — ensure investor materials are up to date, robust, educational, and address positioning in the current environment as appropriate
  • Execute regular perception studies — speaking from client experience, we recommend conducting a study every two years, on average

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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