Estimates

While trying to compile an “evaluation template” for the board to use I found myself encouraging readers to look at the estimates posted on Yahoo as a way of judging what the “experts” think will happen. I even contemplated adding those to your real numbers on charts as a way to visualize the possible earnings curve AND then seeing where the real numbers fell in comparison. I also recall that we mostly disregard earnings estimates, and rightly so.

BUT…I wanted to relay a fascinating “fact” that I have seen and heard proven out several times (e.g NatGeo Brain Games tv show and Freakonomics podcast).

So it goes like this, whether you have a crowd guessing how many jelly beans are in a jar or how much the cow weighs at the county fair, the crowd average is usually very accurate. If there are 500 jelly beans, some fool will guess 100 and some fool will guess 1000, but most will not be crazy off. But time after time, the average of all those guesses is really, really close. (you need at least 20)

So, don’t totally ignore analysts estimates, just don’t trade on them.

Oh, but many of our early discoveries may not have many analysts and by the time they do, there is no more hidden value and we sell :wink:

(kids are bad because once the first kid takes a guess, all the other kids crowd around her or him with their guesses)

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(kids are bad because once the first kid takes a guess, all the other kids crowd around her or him with their guesses)

Are you sure that analysts aren’t like kids?

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Are you sure that analysts aren’t like kids?

Why are you insulting kids?

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Does anyone know why my original post on this was deleted? There was nothing offensive, political, or copyrighted so I don’t understand???

Nevermind!!! I must have clicked on the “unthreaded” view and was only seeing replies!!

Doh.

thanks for the “fun fact”…

Let’s put it to the test…lol

What is Saul’s net worth?

The more responses we get, the more accurate the results…

Let’s make Saul blush…

(in jest of course)

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The only guess I will make, and it isn’t really a guess… less than his actual value.

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By wisdom a house is built, And by understanding it is established; And by knowledge the rooms are filled With all precious and pleasant riches.

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