07-30-2021, 03:50 PM
Analysts under estimating expectations to push prices up?
<!-- SC_OFF --><div class="md"><p>Every single earnings for big tech and almost all big holdings come in above the average analyst expectations. So it begs the question are analysts really that bad? Or is there a possibility that they consistently under quote what earnings are likely to be so that every earnings announcement is a beat and in theory the stock price continues to rise? </p> <p>These analysts work for firms that hold these stocks don’t they? So what would be their incentive to have a stock under perform analyst expectations? Surely they are incentivised to issue estimates that are going to be beaten and cause the earnings to seem great? </p> <p>How else is it possible that almost every earnings announcement from big tech firms come in above the average analyst expectations? In what job can you consistently get your estimates wrong (on the low side every time) and continue to be employed and repeat the same ‘mistake’ quarter after quarter after quarter?</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/wballz"> /u/wballz </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/ou0hnx/analysts_under_estimating_expectations_to_push/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/ou0hnx/analysts_under_estimating_expectations_to_push/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>Every single earnings for big tech and almost all big holdings come in above the average analyst expectations. So it begs the question are analysts really that bad? Or is there a possibility that they consistently under quote what earnings are likely to be so that every earnings announcement is a beat and in theory the stock price continues to rise? </p> <p>These analysts work for firms that hold these stocks don’t they? So what would be their incentive to have a stock under perform analyst expectations? Surely they are incentivised to issue estimates that are going to be beaten and cause the earnings to seem great? </p> <p>How else is it possible that almost every earnings announcement from big tech firms come in above the average analyst expectations? In what job can you consistently get your estimates wrong (on the low side every time) and continue to be employed and repeat the same ‘mistake’ quarter after quarter after quarter?</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/wballz"> /u/wballz </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/ou0hnx/analysts_under_estimating_expectations_to_push/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/ou0hnx/analysts_under_estimating_expectations_to_push/">[comments]</a></span>Kind Regards R