Guidance cut
📊 EarningsManagement lowers its outlook.
Typical size
6-25%
Timeframe
Immediate; recovery takes multiple clean quarters
Evidence
5 logged events
Why it moves the price
Forward estimates fall and the multiple usually compresses at the same time, because a cut signals management has less visibility than investors assumed.
What separates a good call from a naive one
The most violent common catalyst in equities. First cuts are rarely the last — companies that cut once often cut again, so an immediate 'buy the dip' is dangerous. Watch whether management blames the company or the environment.
Measured impact
Every logged event is measured against real closing prices: the move from the close before the event, compared with the S&P 500 over the same window.
Next day
-22.78%
- Median
- -21.40%
- Moved up
- 0% of 5
- vs S&P 500
- -22.32%
After 1 week
-25.65%
- Median
- -24.57%
- Moved up
- 0% of 5
- vs S&P 500
- -24.48%
After 1 month
-22.68%
- Median
- -23.39%
- Moved up
- 0% of 5
- vs S&P 500
- -21.63%
The logged evidence agrees with the textbook expectation. Based on 5 measured events.
The evidence (5)
Every row is a real event, measured against actual closing prices.
| Date | Stock | What happened | Next day | 1 week | 1 month | vs S&P |
|---|---|---|---|---|---|---|
| Aug 29, 2024 | DG | Full-year outlook cut as core customers pulled back | -32.15% | -35.07% | -29.49% | -32.16% |
| Jun 28, 2024 | NKE | FY25 revenue guided down on weak lifestyle demand Reported after the close on Jun 27. | -19.98% | -19.92% | -21.91% | -19.59% |
| Mar 22, 2024 | LULU | Full-year guidance cut on slowing North America demand | -15.80% | -18.42% | -24.44% | -15.61% |
| Oct 27, 2022 | META | Q3 results paired with heavy spending plans and weak outlook Reported after the close on Oct 26. | -24.56% | -30.26% | -14.18% | -24.02% |
| Sep 16, 2022 | FDX | Full-year forecast withdrawn on a sudden volume slowdown Pre-announced after the close on Sept 15. | -21.40% | -24.57% | -23.39% | -20.23% |
Measured from historical closing prices. Past reactions do not guarantee future ones. Not financial advice.