Investors are continuously subject to extravagant projections by those who are seeking to attract financing. These can range between borderline, or even outright fraud, think Theranos, or relatively minor, and often unintentional estimate shortfalls, such as a slippage of time lines. Think the ever shifting timeline for the start of production for Tesla’s cyber truck and auto industry estimates relating to autonomous vehicles.
It is probably safe to say that all of this can make life more difficult for investors and portfolio managers. Thanks to the internet, a lot of relevant information can be found, but the increasing complexity of many business models makes the investigation process more difficult and time consuming. This suggests that a team approach to investment research and portfolio management may prove to be beneficial.
All comments and suggestions are welcome. Walter J. Kirchberger, CFA