Stocks of companies that surprise the market with better-than-expected quarterly numbers are swiftly ratcheted-up in value. By contrast, a negative earnings surprise will usually cause the stock to be sold off by the market, especially if there are high growth expectations factored into its share price and it is expensive relative to those expectations.
Surprising Earnings Results
by Ben McClure,
Ben is director of McClure & Co., an independent research and consulting firm that specializes in investment analysis and intelligence. Before founding McClure & Co., Ben was a highly-rated European equities analyst at City of London-based Old Mutual Securities.
http://www.investopedia.com/articles/stocks/06/earningssurprises.asp
Accessed on 19/12/2007
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Quarterly Earnings surprise is a topic that has substantial scientific research in its favour.
Tuesday, December 18, 2007
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