Yet Another Ugly Headline

Posted: October 24, 2005 in Uncategorized
While we’re on butchered headlines, let’s look at Intel (INTC).
Last week, INTC reported 32 cents per share.  Estimates were expecting 33 cents.  All the headlines read:
     Intel misses
But, INTC had a 2 cent non-recurring legal charge that should have been added back into INTC’s results.
So INTC actually posted 33 cents and beat estimates.
I don’t have to tell you what a huge difference "beats" vs. "misses" means in the world of investing… especially for one of the two great tech bell weathers.
Just try to find a journalist who reported that — or even revised their original report. 
Even as he reinforces the mistake, Bill Snyder of is about the only one to even mention a possible confusion.  (His cohort at Richard Suttmeier did in an earlier story as well.)
Doesn’t matter — shame on INTC’s Investor Relations folks for mucking up something so simple as giving clear information in the first place.
P.S.  How powerful is this effect?  Google (GOOG) mucked up their 2nd quarter report in a similar way — actually beating estimates but not presenting the information in a clear way.  The result was GOOG treaded water the entire 3rd quarter.
P.P.S.  How does negativity spread?  Take INTC’s statement that it’s selling absolutely everything it can make.  Sound pretty positive, eh?  Once you’re in a negative press groove, though, what gets reported is, "the company expects to have capacity issues in the 4th quarter."  Go figure.  We should all be so lucky as to have our demand through the roof.

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