“As long-time readers of this blog know, we’ve been running for more than four years a friendly competition we call the Apple Earnings Smackdown,” Philip Elmer-DeWitt reports for Fortune.
“What made the exercise particularly interesting — at least in the early years — was that the more bullish amateurs tended to beat the conservative pros, often by a embarrassingly wide margin,” P.E.D. reports. “That’s changed in the past year or so. Although Apple has yet to miss its own guidance, it has on more than a few occasions come in short of the amateurs’ over-heated estimates. It has even missed a couple of the Street’s consensus numbers — misses that have cost its share price dearly.”
Full article, with the performance of the 40 Apple analysts who have participated in at least five of the past nine quarters, here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Oh.
even most pros who follow AAPL don’t perform full TOST analyses and adjust +-BACN towards BUN. Just the usual LATTE curve. So who’s really to blame?
Breakfast.
I blame those darn analysts for the lack of iMacs last quarter!
You should also blame them for not being able to tell the difference between a quarter comprised of 13 weeks as opposed to 14 weeks.
I don’t believe the 14th week affected analysts estimates.
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And a shortage due to lack of supply — as distinct from lack of demand.
Well, this article clears everything. I suppose that we shall no longer see any more posts regarding the movement and price of Apple stock ever again or read any more complaints about someone’s sagging portfolio. I think we call all agree that this insightful text will end all rumor, speculation, and controversy.
That reminds me, how come MDN never follows up on all those pundits it iCals?
It would have been better if they recalculated the ranking for each quarter for only the 40 analysts. Including those who do not regularly make calls skews the rankings.
In general it looks that all of the 40 analysts were highly variable in their analysis and a coin would just be as successful.
yup…happens with every major stock every where in the world. all real money managers need/want is consistency. an analysts who is consistently wrong is just as valuable as an analyst who is consistently right. one could argue that the analysts in the middle of the list are the “worst” in terms of consistency.
If only all the analyzing, good and bad, didn’t have such an essential subterfuge to it. Stop analyzing so much, especially predictively, and let the market go where it goes.
It’s time we start striking back: We regulars at MDN need to start providing estimates for these analysts’ hit/miss ratios. And when they miss our estimates, they’re stock goes down.
A word of caution since most here know there is no relationship between an analyst estimate and the company’s performance: We also do not need to show any relationship between our estimate of how an analyst will fair and how the analyst actually fares. Just as for them in their jobs, there is no penalty for our estimating their performance incorrectly.
This might seem complicated so I’ll start off:
I estimate that next quarter James Cordwell (the only tracked analyst with a name like mine who has been covering Apple for at least a year) will NOT GUESS APPLE’s ACTUAL REVENUE OR PROFIT OR EPS.
So pick your analyst and make your prediction. In my case, if James DOES guess two out of those three measurements correctly, his stock goes up.
Yes, I know this is biased towards hammering the analysts. They made their bed!
Absolutely the worst independent analyst, maybe among the whole Braeburn group when it comes to “predicting” Apple’s target price. Follow the Braeburn group if you want to lose all your money.
http://www.postsateventide.com/2012/08/apple-price-target-950-per-share.html
Robert Paul Leitao’s 12 month Apple prediction of August 11, 2012. Honestly, I didn’t think anyone could be that far off. Apple will likely be sitting at $450 or lower in August 2013. Despite all of Leitao’s meticulous calculations, I’m pretty sure a chimpanzee of average intelligence could do better at predicting Apple’s share price. It’s all out there to critique, so don’t accuse me of making anything up. I personally don’t think he’s paid much attention of how Wall Street values Apple or Apple’s shrinking P/E over the last five years.
As a vocal critic of the modeling these people do, I must admit that programmed trading shares some blame in the share price drop, and the programs take their cue from the negative or positive nature of the headlines. So forego the technical trading and the fundamental trading methodologies and embrace the sound-bite trading methodology of valuing a company.
Forget the wall street analysts, MDN should put their iCal to good use and do a worst of the product analysts in the last couple of years.
There should also be a hall of fame.
The very idea of judging a company by how close its performance comes to the wide-eyed guesses of a bunch of Wall Street gamblers is RIDICULOUS!!!
I’m impressed at the snobbery: the elitists actually statistically demonstrating why Wall Street elitists are more elite! All of them specialize in how to make many off someone else’s work: none of them could run a successful manufacturing business and provide an once of value to the world.
Really hate seeing all these distracting stars due to this comment-rating system. I’ll have to pass on reading today- already have a headache.
Heartily agree, just another layer of BS to make the site developers feel good!
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