Thursday, January 17, 2008

"Wall Street Finest" Or Bring Back Blodget........

They are sounding like the homebuilder analysts 18 month ago, the banking analysts 6 month ago etc..... Amazing how out of touch with reality these so called "experts" are. Lets hope they have tied their compensation to the accuracy of their forecasts.... :-) Sometimes it´s better to leave the spreadsheet, don´t take the comments from Management as granted and just visit main street......

Eriunnert mich irgendwie an die Analysten die vor 18 Monaten Homebuilder oder bis vor 6 Monaten zum Einstieg bei den billigen Banken geblasen haben.... Es ist erschütternd wie fern jeglicher Realität diese sog. "Experten" agieren. Bleibt zu hoffen das deren Bezahlung an die Prognosequalität gekoppelt ist.... :-) Evtl. sollten die sich von Ihren Tabellen mal in die reale Welt bewegen und nicht jedes Wort was das notorisch optimistische Management in der Märchenstunden der Telefonkonferenz erklärt sofort für bare Münze nehmen..

With Recession Looming, Tech Profit Ests Look Too High Barron´s Tech Tradder Talk

If we’re heading into a recession - and it sure looks like we are - then tech companies can’t possibly avoid feeling some pain. Unfortunately, the Street’s tech analysts have yet to fully bake a downturn into their estimates.

In his Technology Focus newsletter this morning, Cowen & Co.’s Arnie Berman notes that heading into fourth quarter earnings, the consensus tech estimates seem out of synch with the notion that 2008 is going to be a more difficult environment than 2007:

  • Heading into the Q4 reporting season, he notes, the Street was expecting 91% of all tech companies to grow their top lines in 2008, up from 71% in 2007 versus 2006.

  • The Street estimates suggest 89% of tech companies with have higher margins in 2008 than 2007, up from 48% who grew margins in 2007 from 2006.

  • The aggregate earnings of the nearly 400 companies Berman tracks will rise
    21% in 2008, according to Street estimates, up from 14%-15% growth in 2007 and 2006.

“Have Wall Street technology analysts been too busy creating their 2008 financial projections to read the newspaper? No,” writes Berman. “However, we do believe that circumstances will require that they reduce their current revenue forecasts. Even if the global economy does not slow substantially in 2008, the uncertain macro context all but assures that technology budgets will be spent in a more back-end loaded fashion. Given the uncertain and potentially difficult backdrop, we doubt that nearly as many companies will want to forecast rising margins and accelerating profit growth as Wall Street consensus forecasts suggest is likely.”

And by the way: Berman sees one other related risk. “If technology companies try to balance a desire to offer ‘common sense guidance’ with a desire to reassure a very jittery investment community, the risk of multiple estimate reductions through 2008 will be heightened,” he writes.

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2 Comments:

Anonymous eh said...

J-M,

Auf meiner Festplatte I have analyst reports on stocks I was interested in throughout last year -- my broker makes these reports, which are prepared by several well-known investment banks and/or advisers (zB GS), available to account holders like me. So I occasionally download them and read them (although it is often like Charles Kirk turning on the TV).

I have one prepared by Argus about CFC, dated July 27, 2007, where they (immer noch) rate CFC a "Buy", albeit with a lowered price target of $35.

Es gibt viele ähnliche Beispiele...

Fast eine Art von Kriminalität, oder?

1:05 AM  
Blogger jmf said...

Moin Eh,

at least it´s a legal "crime".....

When looking at stocks like Allianz today i think the market is now slowly discounting the monoline exposure of these financial stocks.....

The topic "counter party risk" will be the next word dominating the headlines and is probably becoming an even bigger problem than "subprime"

1:18 AM  

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