Meta and Tesla report earnings next week. Analysts have prepared forecasts. The forecasts will be wrong.
This happens every quarter. Analysts guess at revenue. They guess at margins. They build models that assume the future looks like the past but slightly better. Then the companies report actual numbers. The numbers differ from the guesses. Stocks move based on how the wrong number compares to the other wrong number.
General Motors and major airlines will also report. More analysts have prepared more forecasts for these companies. These forecasts will also be wrong. The degree of wrongness varies by sector and analyst competence, but the wrongness itself is guaranteed.
Here's what happened in the past: companies reported numbers, stocks moved, retail traders checked their portfolios and felt either briefly euphoric or persistently nauseous, then new forecasts were issued for next quarter. The new forecasts were also wrong. This cycle has repeated without interruption since the invention of publicly traded equities.
The article promises to tell you what to expect. What to expect is this: you will read analyst forecasts, you will believe they contain information, you will make decisions based on that belief, and then you will learn whether Meta beat or missed expectations by four cents per share. Your brokerage account will adjust accordingly. You will feel something about this adjustment. That feeling will have no correlation with your long-term returns.
The analysts know their forecasts are noise. The companies know the forecasts are noise. The only people who don't know are the ones refreshing their portfolio app at 4:01 PM on earnings day, wondering why they're down $347 because Elon said something weird about robotaxis again.
Check back next quarter when different analysts will forecast different wrong numbers for the same companies.
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