Wall Street Prep

Sample Equity Research Report

Sell side equity research analysts primarily communicate their ideas through published equity research reports. In this article, we describe the typical components of a research report and show how they are used by both the buy side and sell side. Equity research reports are usually available for a fee through financial data providers. At the bottom of the article, we include a downloadable sample equity research report.

Timing of equity research reports

Barring a new company initiation or an unexpected event, equity research reports tend to immediately precede and follow a company’s quarterly earnings announcements. That's because quarterly earnings releases tend to be catalysts for stock price movements, as earnings announcements likely represent the first time in 3 months that a company provides a comprehensive financial update.

Of course, research reports are also released immediately upon a major announcement like an acquisition or a restructuring. Additionally, if an equity research analyst initiates coverage on a new stock, he/she will likely publish a comprehensive initiation piece.

How are equity research reports used in practice?

Equity research reports are one of several types of key documents analysts have to gather before diving into a full-scale financial modeling project. That's because research reports contain estimates used widely by investment bankers to help drive the assumptions underpinning 3-statement models and other models commonly built on the sell side.

On the buy side, equity research is also widely used. Like investment bankers, buy side analysts find the insights in sell side equity research reports helpful. However, equity research is used to help the buy side professional understand the "street consensus," which is important for determining the extent to which companies have unrealized value that may justify an investment.

Anatomy of a sell side equity research report

A full equity research report (as opposed to a short one-page "note") usually includes:

  1. The equity research analyst’s investment rating
  2. A one-page summary of what the analyst thinks is about to happen (ahead of an earnings release) or his/her interpretation of the key takeaways from what has just happened (immediately after the earnings release)
  3. Comprehensive detail about the preceding quarter (when company has just reported)
  4. Detail about near-term catalysts
  5. Snapshots of the analyst’s earnings model and detailed forecasts

Sample equity research report

Below is a research report published by JP Morgan by the analyst covering Hulu. Download the entire report by clicking the image below.

sample equity research report

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