Jul 13 2009
Confused About Stock Market - Case In Point
For those of you that read my blog “Is Anyone Else Confused About the Stock Market”, I found an example of the point that I was attempting to make in my entry. If you recall I stated, “So, in spite of how much your company has grown or how well your company is managed, the fact that you didn’t meet some analyst’s expectations for the quarter has led people to think that your company is somehow faltering and worth less”. The corollary, as I stated in the article, was that your company could be in complete shambles but as long as it meets the expectation of analysts, it is considered healthy and strong.
In today’s headlines was the statement, “The Dow Jones gained about 50 points at mid-morning. Banks got a boost after analyst Meredith Whitney said on CNBC that she was upgrading her view on Goldman Sachs Group Inc., which has long been considered the strongest bank amid the economic downturn.” Who is this Meredith Whitney and what information is she using to upgrade her view that Goldman Sachs Group Inc is better off today than a few days ago? After all, there was no massive downgrade of the Wall Street financial market stocks before it went belly-up a few months ago.
I understand that there are very sophisticated methods of analyzing a company but there is only so much information you can get from a bunch of numbers and assumptions.
