So let's just continue the "102" version of this thread....
Here's why EARNINGS are important -- but those FORWARD looking statements are even MORE IMPORTANT....
Let's continue to use Halliburton as todays example....
They beat on the earnings number - but made that caveat that going forward earnings might be impacted negatively...
When you couple this with a 1.02% dividend... so you don't have that nice "pay me while I wait for things to turn around"... "support level"... suddenly there's more sellers than buyers and the stock price declines.
IF --- it paid a 5% dividend - my guess is the stock would have hardly budged... They didn't say the business stunk - they just said it may have some impact yet they still managed to beat the earnings estimate - so it couldn't be "that bad"... But this is a stock that NEEDS that stock price GROWTH component - and if that's not there to offset that low dividend - then you get what you're seeing today... a decline.
Now -- if you're listening to the talking heads -- then you'll hear the words "it'll need some kind of CATALYST going forward". What they're saying is in layman's terms -- it will need a big business turnaround - or some big new oil field discovery or similar to get it going UP again. There will have to be some big news that will point to some event to get the GROWTH back in the stock price.
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