Question

4. An Analysts’ Meeting is an annual meeting held by publicly traded corporations where the company executives provide information about how the company is performing and its future prospects. They may also choose to answer questions from analysts and investors. Some companies make their meetings widely available via webcast and/or podcast. What is Wall Street’s reaction after Nike’s meeting?


5. Due to the uncertainty, the portfolio manager determines to ignore Wall Street analysts, and carry out her own Fundamental Analysis. In finance, how is the price of a security determined?

Answer 1

4.) Nike's Q3 2019 results and Q4 results were very low than expected and so the stock price decreased by 3.7% on opening price

5.) Change in share price affects the overall market cap (market value) of the company as it is calcuated as market price (share price) * no. of outstanding shares. When the company first steps into share market, it comes through IPO which the investment bankers decide the IPO price. It is the job of Investment bankers to calculate the present values of future cash flows of the company and other valuation methods to determine IPO price. After IPO comes in the market, after that it is just supply and demand that controls the increase and decrease of share price.