Thursday, July 24, 2008

Let me ask you a question. Can you explain what the freak is going on with the stock market? Look at these two companies. They both announced earnings on Tuesday.

Company 1

Lost $4.20 per share in previous quarter
Projected losses of 3-4 Billion in next quarter.
Stock goes up 47%

Company 2

Earned $1.96 per share, above projections
Record earnings.
Stock goes down by 15%


Company 1 is Wachovia, WB
Company 2 is Precision Castparts, PCP

I own stock in PCP. Naturally I would like to earn money on said stock. Naturally when a company does well, you'd expect the stock price to increase. Instead, it's tanking like theirs no tomorrow.

F!

3 comments:

Plang said...

It is frustrating, but the banking sector has been abused on the street, so when the news isn't as bad as people fear, then the stock rebounds. Really, so much of this crap is based on estimates by people that don't work at the companies. My company's stock is the same way. When they put out good news, the stock goes down.

I noticed Google started taking a beating this week because they were below estimates, yet still raking in BILLIONS.

Tim said...

But that's exactly the thing... WB came in far worse than estimates and went way up. PCP came better than estimates and went way down.

J Money said...

I know that I, for one, enjoy PCP as often as I can. Coke and heroin, too.

Oh, wait, not that PCP? Oh, right... I knew that... disregard what I said.