Does FD prohibit “walking the Street down”?
Yes. At its heart, FD prohibits a company from adjusting expectations, by a material amount, via conversations with analysts. If you want to reset Street expectations, you will need to do so through a press release or open conference call. FD does not explicitly address the flip-side of the coin: may you provide comfort to analysts that the company is on track to reach Street expectations? Analytically, telling an analyst (or investor) that “we re on track” especially late in the quarter is arguably as material as saying “we ll miss.” The logical corollary of FD is that a company should not provide interim progress reports to analysts during a quarter, unless the company makes those updates public.
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