GAAP vs. Adjusted

Good for stock prices? My take is that they expect stock prices to drop because earnings will be less inflated. That’s good for buyers but not for sellers and the stocks themselves don’t care. But new buyers would push prices up again. Confusing! :wink:

Shift from non-GAAP bottom lines could be good for stock prices

By Noel Randewich

SAN FRANCISCO (Reuters) - Investors worried about lofty stock-market valuations may take comfort in signs that companies in the benchmark S&P 500 index are padding their bottomlines less than they have in previous years.

Recent changes to accounting standards and a crackdown last year by the Securities Exchange Commission are encouraging many companies to be more cautious about reporting metrics that do not adhere to Generally Accepted Accounting Principles (GAAP).…

Denny Schlesinger

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