Question

The Dow Chemical Company announced first quarter 2013 earnings of $660 million, on flat revenues. Earnings per share ($0.69) beat the consensus analyst forecast of $0.61. In reaction to the news, Dow’s stock price rose over 5 percent to $33.96 per share over the next few trading days.

REQUIRED:
a. What is a consensus forecast?
b. Why are companies concerned about meeting or beating the consensus forecast?
c. What strategies can companies use to help meet or beat the forecasts, and why might those who analyze financial statements be concerned?



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  • CreatedAugust 19, 2014
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