Analysts See Less Data in Wake of SEC Rule

Stock analysts and portfolio managers feel more cut off from the corporations they follow months after a rule took effect forcing companies to disclose market-moving information on a wider scale, according to a survey released Monday.

Fifty-seven percent of analysts and portfolio managers said the “volume of substantive information” put out by companies has fallen since the new rule took effect, according to a survey by the Assn. for Investment Management and Research.

Regulation Fair Disclosure, or Reg FD, adopted by the Securities and Exchange Commission and made effective Oct. 23, 2000, stipulates that companies must distribute financial information evenhandedly.

The SEC’s intention was to make sure market insiders such as analysts and big fund managers--who often enjoy cozy relationships with corporate executives--do not have access to news before the public.

AIMR said it received responses from 423 analysts and portfolio managers. Of those, 81% agreed that it is easier for companies to minimize investor communication and 71% believe that the new rule has led to more volatile stock prices.

But data from market research firm First Call/Thomson Financial show companies have been more forthcoming with regard to earnings guidance.