I’m seeing a lot of companies that had tremendous growth over the past 3 years and at the first sign of “unmet targets” they take drastic measures (I.e. letting go of workforce). While their investors might indeed lose their confidence, sell their shares and, therefore, decrease the overall firm value, companies have made and still have lot of money in the bank, why do they need to care about growth, share price and what investors think to such extreme extents? Wouldn’t it be ok to just go with “we did not grow a single point this year and we have made the exact same profits of last year, that’s really good!”
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If you’re invested in a company, you’re hoping to make money. Specifically, you’re hoping that the share of the company that you own will go up in value.
If the company is telling you that they’re not a good investment, you’re going to want to pull out your money and invest in something I think is better.
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