What is a consensus forecast

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Reference no: EM131411009

Movie rental company Netflix announced first quarter 2009 earnings of $32 million, on revenue growth of 21 percent. Earnings per share ($0.54) beat the consensus analyst forecast of $0.50. In reaction to the news, Netflix's stock price rose nearly 5 percent to $47.70 per share.

REQUIRED:

a. What is a consensus forecast?

b. Why are companies concerned about meeting or beating the consensus forecast?

c. What strategies can companies use to help meet or beat the forecasts, and why might those who analyze financial statements be concerned?

Reference no: EM131411009

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