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It is increasingly important for firms to meet or exceed analysts' consensus earnings forecasts. Often management will give guidance or hints of the earnings per share prospects over the next quarter or next year to try to direct the consensus to what is achievable. For example, it is possible that the consensus is well above management's internal forecasts. Management will try to guide the consensus downwards so that when the earnings are released the negative surprise is minimized. Under Regulation FD, management needs to be very careful to provide guidance information to all shareholders -- not just a select group of analysts. This is often achieved in investor presentations (that are often webcast) or conference calls (where anyone is allowed to dial in).


An announcement, often over a conference call, by a publicly-traded company of its projected earnings for a quarter or year. Guidance gives investors and analysts a basis from which to make their investment decisions and recommendations. Guidance also helps the company price out any potential good or bad news so its share price is not subject to wild fluctuations when the earnings are actually announced. Guidance is also called earnings guidance.


Guidance, or earnings guidance, occurs when the executives of a publicly traded corporation estimate projected earnings in an open conference call or Web cast before its quarterly earnings are released.

Goals for providing guidance include underplaying expectations to avoid negative surprises, serving as a counterpoint to stock analysts' consensus estimates, reducing stock price volatility when actual results are announced, and potentially shifting investor focus from short-term results to long-term perspectives.

Corporations also provide guidance to the investing community as a whole because they are prohibited by Securities and Exchange Commission (SEC) Rule FD (for Fair Disclosure) from providing important and previously nonpublic information selectively, as they did before the rule was enacted in 2000.

Those who advocate providing this type of guidance argue that the more information investors have the better. Detractors say guidance doesn't reduce volatility or achieve other goals.

References in periodicals archive ?
The teacher survey contained items that reflected their perceptions of level of implementation of aspects of a comprehensive developmental guidance program.
Career Genograms in Elementary School Developmental Guidance Programs
In Nebraska, it appears that having a differentiated delivery system, which is a shared feature of the ASCA National Model and traditional comprehensive developmental guidance, was found to be most strongly associated with enhanced student outcomes.
These activities are intended to promote competence in students' attitudes, beliefs, knowledge, and skills, which are all part of a comprehensive developmental guidance program.
The school counselors found that their developmental guidance lessons were a key place where they could build relationships with all of the children in the school and establish themselves as supportive adult figures for the students.
Regardless of the instructional content, whether it is academic or developmental guidance curricula, students learn differently and at varying rates.
When developmental guidance standards, competencies, and indicators are in place, the school counselor's role in enhancing the learning process is clear.
Comprehensive, Web site contained the "The counseling developmental descriptor comprehensive, department provides counseling developmental program, services to every student program and/or references to through a comprehensive, academic, career, and developmental guidance personal social curriculum .
Several proactive, school-based, affective-curriculum approaches to developmental guidance have been developed for gifted students, though without empirical support.
Effective pre-kindergarten to Grade 12 developmental guidance curricula are critical to youth who have limited support outside the school setting.

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