Researching Financial Terminology for Financial Earnings Calls

In many ways, financial/investing terminology is a language all to itself. Reading financial earnings calls transcripts or press releases is a good practice that helps you develop your understanding of these terms, but chances are you will still come across some that you haven't used before for at least your first few earnings call seasons. In these situations, it's important to know what you DON'T know so that you can research anything that is at all unfamiliar.

For example, a speaker may say what sounds like "S. G. N. A.," but what they're really referring to is SG&A, which is selling, general and administrative expenses.

Another example of an acronym that has a misleading pronounciation is CAGR, or compound annual growth rate, which is not prounounced as "C. A. G. R." but rather as "kay-ger."

Others include:

• ARPU (which, by the way, I love to say!), average revenue per user, or "ar-poo"
• EBITDA, earnings before interest, taxes, depreciation and amortization, or "ee-bit-ah"
• GAAP or non-GAAP, generally accepted accounting principles, or "gap"

There are many, many more of these acroynms that are not necessarily easy to decipher when spoken, so you'll want to use the context and the common terms list at the end of this post to help you figure out the terminology used.

The following sites all offer comprehensive, searchable databases as well:
Investor Words
Yahoo! Finance
Investopedia

Finally, here is a list of terminology. Please note that this list is not comprehensive, but it does cover a lot of the most common terms. I hope to continue adding definitions to the list for your reference, but having the correct term in front of you is more than half the battle!

Terms/Acronyms	Definition
accrual, accretive, accrue	growing in size
ADR	American Depository Receipt
ANDA (ay en dee ay)	abbreviated new drug application
annualized	financial figurextrapolate a value for a given time period to reflect a full year value
antigens (medical term)
AP	accounts payable
apples-to-apples	to compare like values
ARPU (ar poo)	average revenue per user
APR	annual percentage rate
ASP	average selling price
assay
AR	accounts receivable
B2B	business to business
backwardation	when futures prices are lower in the long term than the near term
Big Pharma, pharma	short form for pharmaceutical companies
BOE	barrel of oil equivalent
book-to-bill ratio (semiconductor industry)
BP	basis point
BPD	barrels per day
brownfield
buy side/sell side	analyst coverage of stocks
CAGR	compound annual growth rate
CapEx	capital expenditures
cath lab (medical term)
churn	rate of customer attrition
CLEC (see-lek)(telecom)	competitive local exchange carrier
COGS	cost of goods sold
comp, comps, comp store sales
contango	upward sloping forward curve in the futures market
covenant	loan agreement
CRM	customer relationship management
de novo	financial reports of a new/young company
dilutive
DSOs	days sales outstanding
EAFE	Europe and Australia Far East Equity Index
e-business
EBITDA, EBIT, EDITDAX (ee bit uh)	earnings before interest, depreciation and amortization
e-government
EITF (accounting standards)	Emerging Issues Task Force
EMEA	Europe, Middle East and Asia
EPS	earnings per share
escrow
ETA/ETD	estimated time of arrival/departure
fab, wafer fab	short for fabrication
FAS 142, FAS 143	financial accounting standard
FASB 123(R), FAS 123(R)
FASB	Financial Accounting Standards Board
FDA	Food and Drug Administration
FERC (ferk)	Federal Energy Regulatory Commissions
FFO	funds from operations
FICO	credit score
FIFO	first in, first out
FIN (financial standard)
First Call	analyst reference
fiscal
follow-up	additional question
Form 10-K, 8-K 10-Q	SEC forms
free cash flow
FX	foreign exchange
GAAP, non-GAAP (gap)	generally accepted accounting principles
FY	fiscal year
GM	gross margin
greenfield
headcount
HMO	health management organization
ILEC (eye-lek)
in vivo
IPO	initial public offering
JV	joint venture
kinase
LIBOR	London Interbank Offered Rate
LIFO	last in, first out
link-quarter
liquidity
LOE	lease operating expenses
LY, HY, FY, FY '04	last year, half year, full year, full year ‘04
M&A	mergers and acquisitions
mark-to-market
Mcfe (resource sector term)
MD&A	management discussion and analysis
metric, metrics
Mmbtu (exploration)	one million British thermal units
NAREIT	board governing REITs
NDA	new drug application
NOI	net operating income
NOLs
NYMEX	New York Mercantile Exchange
OEM	original equipment manufacturer
OpEx	operating expenses
OPM	original product manufacturer
P/E	price/earnings (ratio)
P&L or P/L	profit and loss
pharmacokinetics, pharmacogenomics
Phase I, II, III, IIa	clinical trials on medical/pharma calls
pari passu
Private Securities Litigation Reform Act
pro forma
protease inhibitor
proteomics
puts, swaps, calls	stock trading terms
Q1, Q2, Q3, Q4, Q4 '04, Q2 '03	1st quarter, 2nd quarter, etc.
QA	quality assurance
Q	abbreviation for Form 10-Q
queue	line up, as in queue for Q&A period
R&D	research and development
ramp up
reagent
Regulation FD, Reg FD
REIT (reet)	real estate investment trust
Reuters
RevPAR	revenue per available room
ROA	return on assets
ROE	return on equity
ROI	return on investment
ROIC	return on invested capital
run rate
S&P	Standard & Poor's
SAC	subscriber acquisition costs
Safe Harbor provisions
Sarbanes-Oxley Act, SOX, SarbOx
SEC	Securities and Exchange Commission
SG&A, G&A	selling, general and administrative costs
share repurchase
Six Sigma
SKU (skew)	stock keeping unit
spend (noun)	the amount spent
spud (oilfield term)
stent, shunt
stock buy-back
TBA/TBD	to be announced/determined
the Street (the City in the UK)	the analyst community
The Patriot Act
top line, bottom line
tranche, traunche
true up
turnkey system
turns (inventory)
VoIP	Voice over Internet Protocol
webcast
website
wellhead
YTD	year to date