Key drivers analysis with Amenity Analytics

Our CapEx key driver includes commentary and sentiment in earnings calls on capital spending related to fixed assets (ex. investments, maintenance, and improvements). Polarity assignments in this key factor interpret increases in capital expenditures negatively as they draw down cash.

Amenity’s Capital Returns key driver includes commentary and sentiment in earnings calls related to buybacks or dividends. Polarity in this key factor adopts the perspective of equity holders, meaning increases in share repurchases and distributions are positive.

The Deception key driver measures, monitors, and understands deceptive language patterns—providing insight into how transparent executives are being during earnings calls.

Executive Change includes earnings call commentary relating to changes in senior corporate management, such as C-suite executives and board of directors. Polarity in this key factor adopts the perspective that departing executives are negative, whereas new appointments are positive.

Guidance includes all earnings call commentary on financial guidance and forward-looking language. The underlying event defines the polarity of the extraction.

Headwinds/Tailwinds covers earnings call commentary and sentiment related to events in the external environment that are mentioned to have an impact on the company. Polarity in this key factor adopts the perspective that headwinds are negative and tailwinds are positive.

Irregularities Change includes earnings call commentary on irregular business events such as legal concerns, accounting matters, or acts of nature.

M&A includes commentary and sentiment on mergers, acquisitions, purchases/sales of assets, synergies, takeover defenses, and other matters concerning inorganic growth. Polarity in this key factor adopts the perspective that organic growth is preferable to inorganic growth. Acquisitions are assigned negative polarity, whereas divestitures are assigned positive polarity.

Market Position & Pricing includes earnings call commentary and sentiment related to the competitive positioning of a company and its products or services. Polarity in this key factor positively interprets instances of market share gains, entrance into a new market, successful product trials/launches, and actionable pricing power. Alternatively, loss of market share, instances of product recalls, competition, and drops in customer spending/traffic are viewed negatively.

The Margin key driver looks at the profitability of a business by including all mentions pertaining to margins (gross, operating, net, cashflow, etc.). Polarity in this key factor adopts the perspective that increasing margins have a positive impact on the company’s profitability.

Amenity’s Wage key driver looks at commentary and sentiment in earnings calls related to any impact in nominal or real wages. Polarity in this key factor adopts the perspective that higher wage-related expenses negatively impact corporate margins and profitability.