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6 June, 21:36

A pharmaceutical company announces that it has received Federal Drug Administration approval for a new allergy drug that completely prevents hay fever. The consensus analyst forecast for the company's earnings per share (EPS) is $4.50, but insiders know that, with this new drug, earnings will increase and drive the EPS to $5.00. What will happen when the company releases its next earnings report?

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  1. 6 June, 21:45
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    Answer and Explanation:

    There will be some volatility in the stock price when the earnings report is released though it is difficult to determine the impact on the stock price.

    We can conclude that, the prices will eventually adjust to the announcement.
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Home » Business » A pharmaceutical company announces that it has received Federal Drug Administration approval for a new allergy drug that completely prevents hay fever. The consensus analyst forecast for the company's earnings per share (EPS) is $4.
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