Of what significance are financial forecasts and financial projections?

Of what significance are financial forecasts and financial projections?
Stock prices show significant movements after the release of information that shows earnings will be higher or lower than current expectations.



Forecasts and projections have a big role to play in the business. Financial analysts and investors look at the financial forecasts and projections before taking an investment call. A positive forecast or expectations of higher numbers result in added interest in the stock.