Sentieo Linguistic Analytics – American Express Q3 Earnings

The following analysis was prepared using tools offered by Sentieo. Sign up for a free trial.

While the new CEO was viewed positively by the Street, and was perhaps previewed in a previous call, the conference call event itself showed an increasing divergence in the direction of the discussion between analysts and management, where analysts are focused more on profitability metrics and card program concerns, while management talked much more broadly.  Given this, and the negative divergence in our sentiment metrics between Management and analysts, it would be prudent to be more cautious on AXP stock at these levels.

Here is our linguistic analysis:

American Express announced a CEO change this quarter.  Versus last quarter, management commentary obviously focused mostly on the new CEO and broad commentary around the company.

october-wordcloud

However, the Sentiment Spread, a measure of the bullishness of management vs analysts, has turned down sharply, suggesting over-confidence by analysts.

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Dissecting The Latest Netflix Earnings Transcript

The following analysis was prepared using tools offered by Sentieo. Sign up for a free trial.

We let our data scientists loose on NFLX’s latest conference call transcript. High-level takeaway:  NFLX is sounding a more muted tone while the Street is still excited, and the stock is at a high.

Key takeaways:

1.  Management sentiment has fallen two quarters in a row. (blue line below)

 

2.  The spread between Management sentiment and Analyst sentiment has fallen to a recent low, implying that while Management is getting less bullish, analysts are not yet changing their tone.

spread

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Sentiment Analysis Of FOMC Statements Reveals A More Hawkish Fed

This article was originally published in Forbes

This piece kicks off our new series on the analysis of the Federal Reserve using Sentieo’s natural language processing power and flexible Doc Search technology. We will focus on bringing interesting ideas and surprising revelations derived from thousands of public federal reserve documents. Join us as we scrutinize meetings, congressional testimonies, and press conferences with some truly impressive technology; and see what’s coming up next in our series:

Sentiment Analysis Of FOMC Statements Reveals A More Hawkish Fed
Why Is The Fed Still Raising Rates? The Yellen Effect
Assessing Fed Chair Hopefuls With NLP Analysis Of Past Speeches
Predicting The FOMC Statement With Beige Book Sentiment Data

The Federal Reserve System’s Federal Open Market Committee (FOMC) meets eight times a year, at 2 p.m. Eastern Time in the basement of a nondescript, Washington, D.C. office building. The terse statements released after those meetings drive the direction of global financial markets and the meeting minutes are carefully scrutinized carefully by the media.

We parsed recent statements and minutes since 2012 using Sentieo’s natural language processing and sentiment analysis and found some interesting trends.

For the most recent statement 9/20, the strongest topic continued to be inflation, as highlighted in the unfiltered word cloud shown here.

The intensity was roughly equivalent to the prior statement, as the Fed continues to be vexed by an inflation shortfall versus expectations. Based on the statements alone, this analysis would suggest that Fed intentions have barely changed.  However, when we apply sentiment analysis to the words in the documents using the Loughran-McDonald context-specific lexicon, which assigns a simple positive or negative value to words based on the financial services industry context, the 9/20 statement occurs as much more hawkish.

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