The short-term mentality that has seeped into the asset management industry means few investors have the time to get really granular in their analysis. Some may also assume that the research community covers every angle already, making further scrutiny unnecessary. In our experience this is not the case.
The sell-side, in particular, has an unhealthy obsession with calling quarterly numbers and is thus prone to missing details that are critical to the bigger picture. Softer aspects such as culture and the quality of leadership – how major decisions are made by the executive – are often treated as separate from the quantitative realm, despite being so strongly correlated.
As custodians of our clients' capital we want to wring as much insight as we can out of publicly available information, even if this means we can't pull the trigger very quickly. It goes without saying that this timing “sacrifice” matters little to long-term investors, and that it is significantly outweighed by the benefits of a thorough understanding of a company's broader prospects.