NEW YORK: Prudential Securities, the brokerage arm of Prudential Financial, has taken the unusual step of forbidding its stock research analysts to speak to the financial press about the stocks they cover. The firm is couching the step as a business decision that is an attempt to save the opinions of its analysts exclusively for its paying clients.
Nevertheless, the decision would seem to have PR implications, as quotes and media appearances by analysts have continued to provide Wall Street firms high visibility within the investment community, even after several scandals involving analysts have sullied the sector.
Prudential believes its analysts that cover macro-market trends might fill the void left by its newly muzzled stock analysts.
"It's important to realize this isn't a PR decision - though it has implications for PR," said Jim Gorman, Prudential PR director. "I expect our analysts that speak on macro trends will keep our brand awareness up."
The move is especially curious given that Prudential's recent ad campaign has highlighted the fact that its stock analysts are not affected by the investment-banking conflicts that plague competitors. Prudential is one of the few large brokerages that does not operate an investment bank.
The firm argues that such an asymmetrical marketing strategy is not a contradiction.
"Our feeling is Ford advertises its cars on TV," said Gorman, "but they don't give them away for free."
- See Editorial, p.6.