Why are analysts predictions so influential on a stock’s price? E.g. analysts predict a company will have £5m earnings after next earnings release, but they only earn £4m.
The share price will often drop due to “the company missing earnings forecasts” rather than it remaining unchanged because “the analysis was wrong”. The opposite applies when earnings exceed forecasts.
The analysts aren’t always right, so why do their predictions hold such sway?
Submitted January 11, 2019 at 08:14AM by Ardinno http://bit.ly/2ChnklZ
