The Letter to the Shareholders

The Letter to the Shareholders

Not all public companies write a letter to their shareholders but they should. It provides the company with the opportunity to communicate to their shareholders the current affairs of their company. Not to mention the prospects for the future of their business and how the management team plan to achieve their goals for the future.

The fact that most public companies don’t bother to do this should tell the investor something about the company. If they can’t be bothered to write the letter, then why should I be bothered about investing in the stock of their company?

The companies that do take the time to write the letter tend to be more shareholder-friendly towards their investors and it can make for fascinating reading…Certainly much more valuable than the mindless knee-jerk reactionary news of the public media.

Lastly, the letter to the shareholders have wager value (see earlier posts about this), in that it is under-utilized information that most people are not aware of. It can often be very educational as the investor who takes the time to read these reports can get a free education from the front lines of a real company conducting their affairs in the business world.

In the next few posts I will pass along the Letter to the Shareholders from the company that holds the biggest position in my investment portfolio, Brookfield Infrastructure Partners (BIP.UN on the TSX, BIP on the NYSE)