Sample ECM Workstreams: Market Updates, Shareholder Analyses, Dilution Models

Introduction

Most of what an ECM analyst produces in any given week reduces to four recurring deliverables. The weekly market update circulates inside the bank and out to selected clients. The shareholder analysis informs investor targeting on a live deal. The dilution model quantifies the impact of a proposed offering on existing shareholders. The peer-comp pitch page anchors valuation conversations in pitches and on live deals. Knowing what each one actually contains and who consumes it is the difference between producing work that gets used and work that gets redone. This article walks through the four core workstreams in order, with the structure and the quality bar for each.

The weekly market update is the single most-circulated ECM deliverable inside an investment bank. It compiles deal flow, market-multiple movements, recent IPO performance, and a forward calendar into a standardized format that goes out to senior bankers, coverage MDs, and selected issuer clients on a fixed cadence (most banks publish on Monday morning).

What Goes Into the Standard Template

A standard weekly market update covers six recurring sections. Deals priced last week, with size, pricing relative to range, first-day performance, and bookrunner composition. Deals filed last week, with size, structure, sector, and lead bookrunners. Recent IPO aftermarket performance, with one-week and one-month total returns versus the relevant index. Sector multiple movements, showing where peer-trading multiples expanded or compressed. The forward calendar, listing pending IPOs, follow-ons, and convertibles expected to launch over the next two to four weeks. A short market commentary section that frames the week's deal flow against macro events.

Who Consumes the Update and Why

The internal audience is broad. Coverage MDs use the update to flag relevant data points to their issuer clients ("your peer Acme just priced 12% above the high end of the range"). ECM directors use it to calibrate pitch positioning. Junior bankers across the bank skim it to stay current. The external audience is narrower: selected issuer clients receive a redacted version, and the update is one of the bank's most useful relationship tools.

The shareholder analysis is a deal-specific workstream that maps the institutional ownership of a peer set to inform investor targeting. It is the analytical input to building the roadshow schedule on a live IPO and to the anchor-investor conversations that precede the bake-off.

What a Shareholder Analysis Actually Contains

The basic version starts with a peer set: typically four to eight publicly-listed companies the issuer wants to be valued against. The analyst pulls the institutional ownership for each peer (13F filings in the US, equivalent disclosures elsewhere) and consolidates the data into a single ranked list of investors weighted by their aggregated holdings across the peer set. The output identifies which institutions are most likely to buy the issuer's IPO based on revealed preference: any investor that holds three of four peers in size is a near-certain participant in the new issuance.

How the Analysis Feeds Investor Targeting

Senior ECM bankers and the syndicate desk use the shareholder analysis to build the roadshow schedule. The most heavily-weighted peer-set investors get one-on-one management meetings; the next tier gets group meetings; smaller positions get conference calls. The same analysis informs anchor-investor outreach for cornerstone-driven deals (more common in Asia and Europe) and the wall-crossing list for pre-IPO crossover rounds.

Shareholder Analysis

A deal-specific workstream that aggregates institutional ownership across a target's peer set to identify the investors most likely to participate in a new equity offering. The analysis weights each investor by their aggregated holdings across the peer companies and produces a ranked list that informs roadshow targeting, anchor-investor outreach, and the size of indicated demand the underwriter expects to clear at the indicative price range.

The dilution analysis is the standard deliverable for any post-IPO follow-on, convertible, or equity-linked transaction. It quantifies the impact of new equity on existing shareholders' ownership percentages, on per-share metrics like EPS, and on voting power.

The Basic Dilution Math

The simplest case is a vanilla follow-on. The analyst calculates the issuer's pre-deal share count (basic and diluted), adds the new primary shares from the offering, and produces a post-deal share count. Existing shareholders' ownership percentage drops by the ratio of new shares to total post-deal shares; EPS dilutes by roughly the same proportion if the deal proceeds are not earnings-accretive in the period analyzed. The output is a simple table showing pre- and post-deal shares, ownership percentage, and pro-forma EPS.

Treasury Stock Method on Convertibles and Warrants

The math gets more involved for convertibles, warrants, restricted stock units, and any other dilutive instrument. The treasury stock method is the standard approach: assume the dilutive securities convert at their conversion or strike price, calculate the new shares issued, then offset by the share buyback the issuer would theoretically execute with the proceeds at the current stock price. The net new shares are the dilutive impact. ECM analysts run this calculation on every convertible deal and on most follow-ons that touch issuers with complex capital structures.

When the Analysis Matters Most

Dilution shows up most pointedly in three contexts: a sponsor-backed issuer running a follow-on where existing investors will be asked to take pro-rata pain; a CEO with a meaningful equity stake who wants to know personally how much ownership they lose; and a board evaluating whether to issue convertibles with capped calls (which reduce dilution at the cost of an issuer-paid premium). The ECM analyst's dilution model is what those conversations turn on.

Treasury Stock Method

The accounting convention for calculating diluted share count from in-the-money options, warrants, and convertible securities. The method assumes all dilutive instruments are exercised, then offsets by the shares the issuer could theoretically repurchase at the current stock price using the exercise proceeds. The net incremental shares added to the diluted count are the dilutive impact. ECM analysts use the method on every dilution analysis involving convertibles, warrants, or stock-based compensation.

The fourth recurring workstream is the pitch deliverable set: the slides that anchor the bank's view of valuation, market window, and execution credibility in front of an issuer.

Peer Comp Set Construction

Building a peer comp set is one of the first tasks an ECM analyst learns. The set typically includes four to eight publicly-listed companies that share the issuer's growth profile, business model, and end markets. The analyst pulls trading multiples (EV/Revenue and EV/EBITDA most commonly), normalizes for fiscal year-end differences, and applies adjustments for growth and margin gaps. The output is the chart that anchors the indicative valuation range.

IPO Case Studies and Indicative Ranges

Most pitches include two to four recent IPO case studies of comparable issuers, walking through pricing, demand, syndicate composition, and aftermarket performance. The case studies build credibility for the bank's execution view and benchmark the indicative range. The indicative range itself comes from applying the peer multiples to the issuer's projections and applying the standard 10-20% IPO discount that underwriters embed.

The four workstreams above account for the majority of an ECM analyst's output across most weeks. Mastering them is the foundation for moving up in the seat, because every more advanced deliverable (the pricing memo, the allocation sheet, the equity story draft) is built on the same analytical primitives.