Look at how far earnings projections have come down in the last three months . You can get this information easily on MSN MoneyCentral. The numbers for Intel show that analysts, at least, have finally started to throw in the towel on Intel s prospects for 2001. That s the kind of huge whack to future earnings projections that you want to see here. Look for signs that earnings projections are still falling .
Analysts haven t capitulated until estimates hit bottom and stop falling.
It s clear that analysts are still lowering earnings estimates. That degree of uncertainty among analysts virtually guarantees that we ll see further erosion of estimates. The pack psychology of analysts also argues for further downward revisions. That s just too far in front to be comfortable. A warning from a competitor, for example, can lead analysts to lower estimates for a stock that previously seemed to have found a bottom.