Piffer OT - And Other Assorted Nuts Message Board

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Strategies & Market Trends : Piffer OT - And Other Assorted Nuts

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To: Junkyardawg who wrote (18755)	2/17/2000 8:03:00 AM
From: long-gone	of 63513

All, a good read!: Edited by Ryan Troup with MoneyNews.com Staff For the story behind the story... Wednesday February 16, 2000 3:05 PM EST So You Think It's a Level Playing Field Wal-Mart (WMT) reports a 23% increase in earnings, beating Wall Street estimates by a penny. The stock falls 8% in two days. Abercrombie & Fitch (ANF) reports a 27% increase in earnings, matching Wall Street estimates. Credit Suisse First Boston, Morgan Stanley, and Deutsche Banc Alex.Brown all downgrade the stock. The stock falls 35% today. True, we are in a volatile market and the companies also spoke about their expectations for the coming year in their conference calls. But, the fact is that they matched or beat what was supposedly expected of them. It seems that these companies missed the "whisper estimate" or what analysts actually thought about the company. The big firms routinely deter investors from relying on what they read on the big bad internet. They say you don't know what shady characters might be behind that information you read online. Heaven forbid you should enter a chat room! Don't be fooled. It's just another sales pitch to keep you buying their research. And what does this research get you? It gets you their opinion on a given day a few weeks ago when the report was printed. Meanwhile, the internet gets updated by the second. At the same time that the big firms issue research reports to their customers, they are likely talking to their biggest clients about what is called a whisper estimate. But unless you trade thousands of shares per day with the firm, don't expect to hear what the whisper estimate is. Major customers such as Fidelity Investments get very preferential treatment. We won't argue about whether they deserve it. It is just a fact. Fidelity, to their credit, does so much business with all the Wall Street firms that they nearly always receive the first call from the analyst about a new (cont) newsmax.com

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