Raising the bar. These are three little words that have taken on a currency, a virtual life of their own in this market. You have to know and understand the power of these words because, in many ways, they have become the determinant of the next 10 points in a stock.
When a company issues a quarterly report, it then presents expectations for the future. In the New Economy, a company that sits still, or doesn't raise the bar, gets pummeled. But a company that raises the bar, or sets new, higher expectations, is a company on the move.
Everybody in the know knows this lingo. It is incredible how often it comes up. Why did
not go up after its blowout quarter? The company didn't raise the bar high enough. Why did
go up so big?
The bar was raised high. No matter that BEA Systems may have just been conservative, if that bar doesn't go up, there is all heck to pay.
Why does this matter? Because it is quite different from the old paradigm, which said that if a company beat the "whisper number," its stock went up. That went out of fashion as a primary method when
began reporting the whisper number. Funny thing about whisper numbers. When they are shouted, they are no longer whispers.
The difficult thing for fundamental, nonchartist individual investors is that you can't find if the bar was really raised unless you are on those conference calls, many of which are closed. That these key sessions, where major material information is released, including how high the bar has been raised -- or worse, whether it has been lowered -- are closed is such a fundamental injustice as to be nothing but wrong.
Get used to this phrase. I have tried avoiding its use because jargon doesn't illuminate. But it is being used way too often not to give it to you as a piece of the puzzle.
Don't forget to fill out our
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gets hit with a negative
article and then issues a secondary. Probably set up for a run after those whackings. ... Great article about false negatives today in the right-hand column of
The Wall Street Journal
. ... Tip-of-the-chapeau department: My hat is off to
, who correctly predicted the
rally (see Heard on the Street today in the C section of the
) ahead of its occurrence. Could have saved desks billions. There is no love between us, but you have to praise a home run call like that.