Hard Truths: There are No Silver Bullets to your Bleeding Stock Price

When stocks go down and volume drops during volatile markets, management and boards suddenly want to know what investor relations is doing for shareholder value and for share price. This is the time the C-suite tends to put IR under the microscope looking for the fall guy. Suddenly, there is an urge to identify the “silver bullet”.

Simply put, there is no “quick-fix” solution to your share price woes nor a band-aid that can stop the bleeding. More truth: IR requires a steady course—one that is tactful, strategic and methodical—if you desire positive, long-term results.

Investor relations is a process-driven function and as such, manages a confluence of actions and activities to achieve its goals. Much like a chemist or a cook, there are a myriad of outcomes that can take place simultaneously—some of which are completely out of IR’s control, like sentiment. Others, such as messaging, can be intentionally constructed, measured and refined for effectiveness.

During downturns, there’s much more to gain by investing in, rather than pulling back on IR activities. Nobody knows when stocks will recover, however, we know that small cap stocks tend to bounce back quicker than their larger peers and they’ll gain faster in the recovery. That’s why during periods of market decline small caps need to be out on the circuit evangelizing and building interest in their company. The reality is, investors don’t have short attention spans—but they do have short consideration spans.

IR is a marathon, not a sprint. It requires buy in, commitment, integration, and support for the long haul—which begins in the c-suite. Management needs to commit to the vision for it to take root. Plus, embrace patience, persistence, and planning. Remember: IR is your ally, not your foe.