News Column

Human Capital Management Institute: Trader Alert: New Research May Shift Moves Seen Around Earnings Reports, Proves HR Metrics Impact Stock Price

May 13, 2014



Marina Del Rey, CA -- The Human Capital Management Institute (HCMI), an industry leader in predictive human capital management metrics and advanced workforce analytics solutions, released research showing that profit and revenue don't actually predict stock price, but some other, little-used metrics do (http://hcminst.com/linking-human-capital-to-business-performance). The study, performed by Jeff Higgins, CEO of the Human Capital Management Institute, and Pepperdine University professor Donald Atwater, shows that human capital contributions to stock performance are clearly linked. According to the model, a 10% increase in human capital productivity metrics are associated with stock price gains of -.7% to 29% by sector. Human capital metrics are significant in all sectors explaining 35% to 64% of rate of change in stock prices, far more than the average 1% explained by net income.

HCMI's research provides a compelling case for publicly traded companies, especially companies releasing earnings reports, such as Nippon Telegraph and Telephone Corporation (NYSE:NTT), Encana Corporation (NYSE:ECA) and LATAM Airlines Group S.A. (NYSE:LFL) to include human capital metrics in the data made public to investors. This transparency could affect stock price movements surrounding earnings reports.

Nippon Telegraph and Telephone Corporation is expected to report earnings today after market close. The report will be for the fiscal Quarter ending Mar 2014. The reported EPS for the same quarter last year was $0.41.

Encana Corporation is expected to report earnings today before market open. The report will be for the fiscal Quarter ending Mar 2014. According to Zacks Investment Research, based on 6 analysts' forecasts, the consensus EPS forecast for the quarter is $0.53. The reported EPS for the same quarter last year was $0.1.

LATAM Airlines Group S.A. is expected to report earnings today after market close. The report will be for the fiscal Quarter ending Mar 2014. According to Zacks Investment Research, based on 4 analysts' forecasts, the consensus EPS forecast for the quarter is $0.26. The reported EPS for the same quarter last year was $0.09.

About HCMI

The Human Capital Management Institute was founded on the belief that organizations can and must find better ways of measuring their investments in human capital. HCMI strives to fundamentally change the way organizations make decisions about their workforce. HCMI's vision of the future is one in which human capital measurement and information is as integral to business decision making as financial information is today. Serving global clients, HCMI delivers advanced workforce intelligence training, assessments, consulting, and the world's most advanced workforce analytics (http://www.hcminst.com/solveworkforce) and workforce planning modeling tools.

CONTACT: Matthew Lemert

Human Capital Management Institute

(323) 522-4264

matthew.lemert@hcminst.com

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Source: M2 PressWIRE


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