Opinion ID: 447943
Heading Depth: 3
Heading Rank: 5

Heading: Optimism vs. Pessimism

Text: 40 Finally, the court's view that an estimate of 40-50% growth in the current fiscal year could be viewed as a pessimistic forecast, in light of the past annual doubling of sales and earnings, was plainly a conclusion as to the materiality of defendants' estimate. Yet it cannot be said as a matter of law that an estimated growth of 40-50% would be viewed by investors as a negative factor. If a company's sales in year X + 1 were twice what they were in year X, and in year X + 2 they were 50% more than in year X + 1, the dollar increases in years X + 1 and X + 2 would be exactly the same. It can hardly be said that a reasonable investor could not find attractive the prospect of a second consecutive year of $21,000,000 increase in sales. 41