Elliott's Singer agrees with Buffett, Dimon on profit guidance

Henrietta Brewer
June 10, 2018

This combo of file photos shows Warren Buffett attending the Forbes 100th Anniversary Gala in New York on September 19, 2017, left, and JP Morgan Chase Chairman and CEO Jamie Dimon on the floor of the New York Stock Exchange on July 12, 2013.

Buffett, who runs Berkshire Hathaway Inc., and Dimon, CEO of JPMorgan Chase & Co., said in a joint Wall Street Journal editorial that they are encouraging all public companies to consider moving away the practice, arguing that it can stifle long-term investments. Around that time, big companies like Coca Cola, UPS and AT&T said they would no longer give quarterly guidance.

Warren Buffett and business friend Jamie Dimon argued Thursday that publicly traded businesses can damage their long-term growth and hurt their shareholders by forecasting their earnings every three months and then making short-term decisions to "make the number".


The two men noted that companies often hesitate to spend on technology, hiring, and research and development in order to meet quarterly earnings guidance that can be impacted by seasonal factors beyond their control, such as political events and even weather. "Let's not forget how we got here: Reg FD was meant to end selective disclosure, the private guidance on future results", Santoli said. In the past, Buffett has said that he could record some of Berkshire's unrealized investment gains at nearly any time if he wanted to make a quarter or year look good, but that wouldn't help the company succeed in the long run.

"Quarterly earnings guidance often leads to an unhealthy focus on short-term profits at the expense of long-term strategy, growth and sustainability", they said in the op-ed.

Dimon said that Schultz "would be a great chief executive or governor or senator or mayor or whatever he wants to do", but added that he's not sure that managing a business makes a person suitable for politics. "We're hoping a bunch of companies drop it right away".


After several controversial statements about bitcoin, the chief executive of JPMorgan Chase Jamie Dimon again tells people to "beware" when trading in the cryptocurrency.

There has been great interest in these companies' health initiative since it was announced early this year, but few details have been released so far.


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