The Fundamentals Lag Price, Right?

When a company beats analyst estimates or misses that there's a lag effect of anywhere from four to six weeks before the rest of Wall Street sort of catches on and upgrades their estimates. Back then what I learned and George Douglas actually did the research is that analysts estimate revisions are the single biggest short-term driver of stock prices. And we're talking about 1983, 40 years ago, still true today. If you look at companies that have reported better than expected earnings, beat on the top line and also raise guidance, those stocks are going to outperform.

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