Guidance and revisions
Markets react to changed future expectations more than to the finished quarter.
Guidance and revisions
| Concept | Explanation | |---|---| | Guidance | Management's outlook for future results. | | Raise | Management increases expected performance. | | Cut | Management lowers expected performance. | | Reaffirm | Management maintains prior guidance. | | Estimate revision | Analysts change forecasts after new information. | | Revision breadth | How widely analysts move estimates in the same direction. |
Key idea: Markets often react more strongly to changed future expectations than to the quarter that has already ended.