![]() At video-on-demand company Netflix Inc NFLX.O ratings rose over the last two years as its stock price rose 157 percent, according to Accern's analysis for Reuters. Sometimes, increases in Glassdoor ratings go hand in hand with rising stock prices. When asked for comment about any link between its tumbling stock price and the Glassdoor ratings, a Cumulus spokesman said: “Over the last year, Cumulus has hired more top talent than all other radio companies combined.” He supplied a list of recent hires to back up the statement. In 2014, in the face of a rapidly changing advertising market, and increasing competition from online competitors, the company’s stock fell from its high of $8 on January 7 to a low for the year of $2.88 on November 11. Between April 2013 and January 2014 the company’s average rating on the site dropped from 2.59 to 2.21, according to Accern’s analysis. Thirty of the 43 anonymous comments posted on the Glassdoor site during the period, or about 70 percent, were negative, compared with 40 of 67, or about 60 percent, that were negative in the preceding 12 months. Between April of that year and January 2014, the nation's second largest operator of radio stations saw its stock price rise by more than 142 percent.īut even as the stock was climbing, the percentage of negative reviews of the work environment at Cumulus was rising. REUTERS/Brendan McDermidįor example, during much of 2013, Atlanta-based Cumulus Media CMLS.O seemed unstoppable. Traders work on the floor of the New York Stock Exchange March 11, 2015. Still, a number of examples can be found on Glassdoor’s website of rising or falling sentiment that paralleled or came in advance of similar moves in stock price, according to an analysis of the site’s ratings and the relationship to share performance that was conducted for Reuters by Accern Corp, a New York-based analytics provider for institutional investors. There is no way of knowing, for example, whether the reviews posted on the site are representative of employee sentiment in general - or even if they were posted by actual employees. When Marissa Mayer took over as CEO of Yahoo! Inc YHOO.O, he said he noticed positive Glassdoor postings on the change.Įven the investors who use sites such as Glassdoor acknowledge they are imperfect tools for analysing stocks. Ron Josey, an analyst at San Francisco-based JPM Securities, said he regularly checks to see what people are posting about the companies he covers on the job website, which allows its users to anonymously comment on employers and rate them on a one-to-five scale. ![]() IMPERFECT INDICATORīlackRock is not the only company that looks at employee sentiment. The team is particularly interested in changes in employee sentiment that might indicate good or bad things happening at a company. ![]() He wouldn’t say exactly how his group gauges employee sentiment at companies they’re interested in, but he did say BlackRock employs automated Internet searches to look for key positive and negative words across a variety of blogs, social media, chat rooms and employee websites. Employee sentiment is part of that, said Ebner. Today, 20 percent of the data used by the group to analyse companies is ‘unstructured’ - meaning it does not come as line items in analyst reports or regulatory filings. But gauging employee satisfaction levels – and understanding how they might affect a company’s performance – can be tricky.Īt BlackRock, which has more than $4.65 trillion in assets, the company’s 77-member quantitative team began adding data from social media websites, including employee sentiment data, into its models for evaluating holdings and investment prospects two years ago. That strategy is in line with a growing body of research suggesting that happy workers can be good for profits. “Happy and engaged employees lead to more wins and more sales opportunities.” “We look for companies that have solid employee rankings and want to buy companies that have improvements in employee opinions,” said Paul Ebner, a portfolio manager and member of BlackRock’s scientific active equity group, a team of quantitative managers. ![]() Some of them also consider something much harder to quantify: employee sentiment. ![]()
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