Professor Elam

Wed January 27, 2016

Boeing beat expected 1.28 in e/s with a 1.60 number.

So the average accounting student might think that BA rallied on the news.

No way, BA dropped over 9% for the lowest close since Oct 2013 Why?

The answer is to look forward not backwards. BA announced full year earnings between 8.45 and 8.65 rather than 9.41 which was the number.

The lesson here is that markets move on social mood and what is anticipated, not what has happened.

Note  Apple is down as well on reduced i Phone sales.